In this regard, the central bank has requested to send a Memorandum of Understanding (MoU) to the government, Ministry of Finance (MoF), Securities Board of Nepal (SEBON), Nepal Stock Exchange (NEPSE) and CDS and Clearing (CDSC). A meeting of the management committee of NRB held on March 25 decided to forward the process. Backed by the decision, a meeting of government bond primary and secondary management committee held on April 1 took the decision of seeking MoU from concerned stakeholders.
As per the Financial Management Department of MoF, all concerned stakeholders are preparing the MoU as per NRB correspondence following which other procedures will be initiated. Dematerialization of government bonds will ease its trading in the secondary market.
Although investors have been demanding dematerialization of government bonds for since a long time, the government has been taking the matter casually. However, repeated efforts from various directions forced the government to take the matter seriously. Now, NEPSE has also carried out groundwork for online trading of government bonds.
At present, a total of 43 including 15 government bonds and 29 corporate bonds are listed in the secondary market. Out of them, while none of the government bonds have been dematerialized only a few corporate debentures have been dematerialized to date. The dematerialized corporate debentures are being traded in the secondary market regularly.
Once, the government bonds are dematerialized they can be easily traded like stocks through online in the secondary market.
