NRB Issues Reverse Repo of Rs 20 Bn

Jan 07, 2021 12:40 PM Merolagani

Nepal Rastra Bank is issuing reverse repo of Rs 20 billion on Thursday, January 7. The bank is issuing the reverse repo in a bid to mop up excess liquidity in banks and financial institutions (BFIs).

The reverse repo will mature in 28 days on February 4. The A, B and C listed BFIs can participate in the auction of the reverse repo.

In order to bid for the reverse repo, NRB has made a master repurchase agreement compulsory for the BFIs.  According to NRB, the interest rate of the repo will be set as per the weighted average of the interest rate bid by the BFIs. Usually, NRB issues short-term reverse repo to mop up excess liquidity in the banking system.

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