KATHMANDU: The Nepal Rastra Bank (NRB) has amended its unified directives to implement its monetary policy, allowing banks and financial institutions to increase the loan-to-value limit on shares used as collateral from 70% up to 80%.

Under the new guidelines, financial institutions can offer this additional 10% leverage by designing specific product papers that assess the financial strength of listed companies.

This assessment must evaluate key metrics such as paid-up capital size, listing duration, profitability, dividend history, credit ratings, regulatory compliance, and regular annual general meetings.

The central bank specified that these product papers must be published on the institutions’ websites and emphasized that once a loan is issued, the underlying shares cannot be revalued to demand further credit limits.