The development bonds issued by Nepal Rastra Bank (NRB), today, were
oversubscribed by over seven times, owing to an overwhelming response
from banks and financial institutions (BFIs). As per its auction
calendar of government securities, NRB issued the Development Bonds (DB
2077A) of Rs five billion with a maturity period of five years.
By the time the auction concluded, the central bank received bids worth Rs 37.33 billion, as per Nara Bahadur Thapa, executive director of Public Debt Management Department of NRB.
Of the bids received by NRB today, Rs 36.65 billion was received from BFIs and the rest from non-banking institutions. NRB had floated 80 per cent of the development bonds for BFIs and the rest for non-banking institutions.
The cut-off rate on the bonds is four per cent, according to Thapa. Altogether 78 institutions had filed 470 bids.
The Legislature-Parliament has authorised the government to issue government bonds worth Rs 52.75 billion in this fiscal and NRB has already published the auction calendar to sell the government securities.
In this respect, NRB will issue Treasury Bills worth Rs 15 billion, development bonds worth Rs 30 billion and foreign employment bonds worth Rs 250 million in this fiscal. Apart from the bonds issued today, NRB had floated citizen saving bonds for public worth Rs 2.5 billion on Tuesday with a five-year maturity period and eight per cent interest rate.
In the last fiscal, NRB had issued development bonds only twice for a total of Rs nine billion. The development bonds floated last year of Rs six billion has a maturity period of seven years with 3.49 per cent interest rate. And another Rs three billion worth of development bonds has a maturity period of five years, with 3.25 per cent interest rate.
Compared to last fiscal, interest rate of this fiscal is quite high and NRB will sell all the government securities that were approved by the Parliament, as the government needs more funding resources this year for reconstruction and development in the wake of the devastating earthquake of April 25 and subsequent aftershocks.
source: the himalayan times, 28 may 2015
LINK
By the time the auction concluded, the central bank received bids worth Rs 37.33 billion, as per Nara Bahadur Thapa, executive director of Public Debt Management Department of NRB.
Of the bids received by NRB today, Rs 36.65 billion was received from BFIs and the rest from non-banking institutions. NRB had floated 80 per cent of the development bonds for BFIs and the rest for non-banking institutions.
The cut-off rate on the bonds is four per cent, according to Thapa. Altogether 78 institutions had filed 470 bids.
The Legislature-Parliament has authorised the government to issue government bonds worth Rs 52.75 billion in this fiscal and NRB has already published the auction calendar to sell the government securities.
In this respect, NRB will issue Treasury Bills worth Rs 15 billion, development bonds worth Rs 30 billion and foreign employment bonds worth Rs 250 million in this fiscal. Apart from the bonds issued today, NRB had floated citizen saving bonds for public worth Rs 2.5 billion on Tuesday with a five-year maturity period and eight per cent interest rate.
In the last fiscal, NRB had issued development bonds only twice for a total of Rs nine billion. The development bonds floated last year of Rs six billion has a maturity period of seven years with 3.49 per cent interest rate. And another Rs three billion worth of development bonds has a maturity period of five years, with 3.25 per cent interest rate.
Compared to last fiscal, interest rate of this fiscal is quite high and NRB will sell all the government securities that were approved by the Parliament, as the government needs more funding resources this year for reconstruction and development in the wake of the devastating earthquake of April 25 and subsequent aftershocks.
source: the himalayan times, 28 may 2015
LINK
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