KATHMANDU: Nepal Rastra Bank (NRB) is withdrawing Rs 25 billion from the market after excess liquidity persisted in the banking system.

The NRB will absorb the funds today, Monday, through the issuance of a one-year debt instrument named “Nepal Rastra Bank Bond 2025 ‘A’.”

The interest rate will be determined through competitive bidding, with interest payments made every six months.

The principal will be repaid after one year on December 29, 2026.

Bids can be placed for a minimum of Rs 50 million, with higher bids required to be exact multiples of that amount.

The bond can be used as collateral to obtain loans from banks and financial institutions. Only NRB-licensed Class A, B, and C institutions are eligible to participate.