Kathmandu. Nepal Rastra Bank has published the third quarter review of monetary policy for the current financial year 2080/81. The National Bank has published the review on Friday.

Similarly, the existing mandatory cash ratio and statutory liquidity ratio have been kept in place. On the other hand, to make the interest rate corridor effective, the system of providing permanent deposit facilities will be reviewed as necessary, according to the Rastra Bank.

Nepal Rastra Bank has reviewed the third quarter of the monetary policy of the current financial year 2080/81 and made 10 new arrangements. Rastra Bank reviewed on Friday and said that based on the latest internal and external economic situation and scenario, the cautious and flexible course of action taken in the annual monetary policy has been continued.

Rastra Bank has also stated that appropriate arrangements will be made while formulating the monetary policy for the financial year 2081/82, keeping in view the domestic economic activity and inflation situation as well as the annual budget of the Government of Nepal for the financial year 2081/82.

Monetary Policy New arrangement:

1. The cautiously flexible course of action taken in the annual monetary policy has been continued in the third quarter review as well.

2. Based on the internal and external economic situation and scenario, the existing policy rate of 5.5 percent, deposit collection rate of 3.0 percent under the interest rate corridor and bank rate of 7.0 percent have been kept unchanged.

3. The existing mandatory cash ratio and statutory liquidity ratio have been maintained.

4. In order to make the interest rate corridor effective, there will be a necessary review in the system of providing permanent deposit facilities.

5. In relation to further strengthening the capital of banks and financial institutions, the necessary facilitation will be done to bring additional tools into use.

6. The existing 125 percent risk load of hire purchase vehicle loans provided by banks and financial institutions will be reduced and maintained at 100 percent.

7. Arrangements will be made to allow banks and financial institutions to sell up to 20 percent of their primary capital in one financial year from among the investments that have lapsed for 1 year.

8. The existing loan loss provision for loans classified as good category from banks and financial institutions will be reduced from 1.25 percent to 1.20 percent.

9. For the purpose of purchasing real estate, the loan repayment income ratio will be simplified and will be maintained at 70% from the existing 50% based on the submission of proof of tax payment.

10. The existing arrangements related to silver import and sale and distribution will be reviewed.