. KATHMANDU: The Confederation of Bank and Financial Institutions (CBFN) has responded positively to the monetary policy for the fiscal year 2083/84 released by Nepal Rastra Bank. The CBFIN has adopted a monetary line with a balanced approach towards price stability, financial sector stability, regulatory simplification and macroeconomic balance.
Management of Bad Loans in Sick Industry and Revival of Stressed Loans, Policy Rate, Fixed Deposit Facility Rate, Bank Rate, Cash Reserves Ratio, Statutory Liquidity Ratio and Permanent Liquidity Facility to help make the business environment more predictable and to maintain policy stability, as well as to make the process of opening or closing of bank branches flexible, CBFIN has taken policy measures such as digitalization of financial services, incentivizing banks to cut operating costs, facilitating liquidity flow management through foreign currency purchases, encouraging commercial banks to invest in foreign government bonds, and sterilized interventions in foreign currency purchases.
Although the important recommendations made by Sibifin during the formulation of monetary policy on risk-based credit loss arrangements, loss management on the basis of total risk in secured loans, some regulatory facilitation related to capital fund adequacy and prudential regulatory reforms in line with international practices have not been addressed at present, the current economic situation of Nepal, increasing capital pressure on the banking sector, non-performing debt management and the flow of credit to the private sector are being made more effective by the Government of Nepal.TAG_OPEN_p_7 The Nepal Rastra Bank is hopeful that the recommendations of the CBFIN, which are crucial to achieving the goal of economic expansion, will be addressed in a practical manner through the upcoming integrated directive.
“TAG_OPEN_span_6} is always committed to continuous constructive dialogue, collaboration and suggestions with the Nepal Rastra Bank and the Government of Nepal to TAG_OPEN_span_5 TAG_CLOSE_span_6 maintain financial stability through the effective implementation of the ongoing monetary policy provisions, make the banking system stronger, competitive and efficient, accelerate the revival of the private sector and revitalize the overall economy,” the statement said.
