NRB issues circular to BFIs ; Borrowers won't confront margin calls regardless of whether share value diminishes by 20%

Borrowers who have acquired Margin loans by keeping their shares in guarantee will now confront less margin calls, on account of Nepal Rastra Bank (NRB's) most recent order.

In accordance with the arrangement made in Monetary Policy of 2075/76, NRB has issued a circular to each class of BFIs that they are not allowed to give a margin call unless the value of shares reduces by over 20%. 

The circular has provided a deep breath to investors at the time of sluggish market. A relief has been provided as the investors won't need to confront the rehashed margin calls from the banks requesting that they keep up the margin even in the event that the offer value diminishes by up to 20%.

Previously, the provision for making margin call was set at 10% of the share price.