Nepal Rastra Bank has released the third quarter review of monetary policy for the current financial year. In the review issued on Sunday, the National Bank has reduced the risk burden of share loans and made general changes in the mandatory cash balance calculation system.

These are the main points of the review:

• Based on the internal economic and financial situation and scenario, the monetary policy has been carefully balanced.
• The policy rate has been kept unchanged at the existing 5 percent, the deposit collection rate as the lower limit at 3 percent and the bank rate as the upper limit under the interest rate corridor at 6.5 percent .
• The existing mandatory cash balance and statutory liquidity ratios have been maintained . Keeping in view the existing liquidity situation of the financial system and the recent improvements made by this bank in the open market trading instruments, it will be arranged that banks and financial institutions must maintain 90% minimum mandatory cash balance daily.
• The risk weight of the existing share mortgage loan will be reduced from 125 percent to 100 percent.
• For the purpose of improving the investment environment, the "Nepal Rastra Bank Foreign Investment and Foreign Loan Management Regulations, 2078" will be issued incorporating the provisions of the latest amendments in the Foreign Exchange (Regulation) Act, 2019 and the Foreign Investment and Technology Transfer Act, 2075.
• According to the amendment of the Banking Offenses and Punishment Act, 2064, a procedure to prove the behavior related to check dishonor will be formulated and issued.