Nepal Rastra Bank (Central Bank of Nepal)
Nepal Rastra Bank (NRB), the Central Bank of Nepal, was established in 1956
under the Nepal Rastra Bank Act, 1955, to discharge the central banking responsibilities
including guiding the development of the embryonic domestic financial sector.
Since inception, there has been a significant growth in both the number and the
activities of the domestic financial institutions.
To reflect this dynamic
environment, the functions and objectives of the Bank have been recast by the
new NRB Act of 2002, the preamble of which lays down the primary functions of
the Bank as: Read More....
History of Banking in Nepal
Nepal's first commercial bank, the Nepal Bank Limited, was established in 1937. The government owned 51 percent of the shares in the bank and controlled its operations to a large extent. Nepal Bank Limited was headquartered in Kathmandu and had branches in other parts of the country.
There were other government banking institutions. Rastriya Banijya Bank (National Commercial Bank), a state-owned commercial bank, was established in 1966. The Land Reform Savings Corporation was established in 1966 to deal with finances related to land reforms.
There were two other specialized financial institutions. Nepal Industrial Development Corporation, a state-owned development finance organization headquartered in Kathmandu, was established in 1959 with United States assistance to offer financial and technical assistance to private industry. Although the government invested in the corporation, representatives from the private business sector also sat on the board of directors. The Co-operative Bank, which became the Agricultural Development Bank in 1967, was the main source of financing for small agribusinesses and cooperatives. Almost 75 percent of the bank was state-owned; 21 percent was owned by the Nepal Rastra Bank, and 5 percent by cooperatives and private individuals. The Agricultural Development Bank also served as the government's implementing agency for small farmers' group development projects assisted by the Asian Development Bank (see Glossary) and financed by the United Nations Development Programme. The Ministry of Finance reported in 1990 that the Agricultural Development Bank, which is vested with the leading role in agricultural loan investment, had granted loans to only 9 percent of the total number of farming families since 1965. Read More....
 |