Now banks and financial institutions can invest in shares for up to 6 months. Previously, it was a rule that an individual could only invest in the shares and debentures of an organization that has been listed on the Securities Exchange Market (NEPSE) for a period of more than one year. That one year period has been reduced to 6 months.
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The maximum limit of 25 crores has been removed for personal share loans. Nepal Rastra Bank has removed this limit through a circular on Wednesday. Earlier, the maximum single customer credit limit for margin-type loans from any one or all banks and financial institutions on share securities was 25 crores.
The committee set up by the government to make suggestions for the capital market recommended removing the limit. The Ministry of Finance gave instructions on Wednesday to implement the suggested report. According to the same directive, the National Bank has removed the share loan limit. It has also adopted a flexible policy in other arrangements related to share trading.
Banks and financial institutions can now invest in shares for up to 6 months. Previously, there was a provision for investing in the shares and debentures of organized organizations that have been listed in the Securities Exchange Market (NEPSE) by selling shares to the general public for a period of more than one year. That one year period has been reduced to 6 months.
The Rastra Bank has abolished the provision that only investments up to 20 percent of the primary capital can be sold in one financial year out of the investments that have been purchased for one year. Based on the conclusion that the stock market has not increased due to these arrangements, the National Bank has made the mentioned arrangements.
