The policy shift was introduced under the 21-point "Capital Market Strengthening and Revival Action Plan-2083" recently unveiled by the Ministry of Finance. While the action plan outlines the reduction to encourage institutional investment and boost market liquidity, the Ministry has directed the Nepal Rastra Bank (NRB) to make the necessary regulatory adjustments.
Market analysts note that the 45-day rule cannot be implemented automatically. The current six-month holding requirement remains in place until the NRB formally amends its integrated directives and circulars. Once the central bank issues the revised guidelines, clarity will emerge regarding the official implementation date, calculation methods, and its impact on existing BFI portfolios.
The government's initiative aims to enhance market turnover and liquidity by allowing BFIs to participate more actively in the secondary market. However, the action plan stipulates that BFIs must formulate robust internal investment policies approved by their boards of directors to minimize speculative risks associated with short-term trading.
