NRB’s new directive will increase the bank’s bonus shares, How ?

Clock Nepal, Kathmandu

The new directive issued by Nepal Rastra Bank has increased the bonus shares of banks and financial institutions. In the new directive issued by the National Bank on Monday, the distributable profit of the bank is expected to increase as the interest to be collected by mid-July 2078 BS has been raised to September 30.

Manoj Gyawali, Deputy General Manager of Naibl Bank, said that the deadline for publishing the financial statements of banks and financial institutions will be extended till September 30 and the distributable profit will increase as the management of bad loans becomes easier.

 NRB has also increased provisioning on loans. NRB has increased the provisioning for good loans to 1.3 percent. Earlier, only 1 percent provision was made for good loans. As a result, out of the current 41.5 trillion loans, bad loans and rescheduling will add an additional 0.30 percent to Rs 39 trillion, according to Gyawali. He also said that an additional 11.7 trillion rupees of debt would have to be managed for the loss.

NRB had earlier provided additional cash up to 20 per cent of the working capital and up to 10 per cent of the term loan to revive the loan during the Covid 19 epidemic. Provisioning of 1 percent on additional loans has resulted in provisioning of 5 percent at present.

However, the new provision in the provisioning will reduce the dividend distribution capacity by up to 30 percent. Net profit of banks and financial institutions may decrease by Rs. 7.4 billion.

Publish Date : July 28th, 2021

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