By A Staff Reporter Kathmandu, Feb. 23: Nepal Rastra Bank (NRB) is set to issue development bonds worth Rs. 10 billion with a maturity period of eight years. The bond named “Development Bond 2085 Gha” will issue bonds through both competitive and non-competitive bidding, according to the notice issued by Public Debts Management Department (PDMD) of NRB. Banking and financial institutions, non-banking financial institutions, insurance companies, organised groups and the general public can apply for the bond. The bank said that the interested parties would have to submit their bids documents through Online Bidding System Software of NRB by 3 pm Tuesday (February 23, 2021). The bond, which will be allocated on Wednesday, will maturity on February 25 of 2029. Interested parties can apply for bonds ranging from Rs. 50,000 to the amount not exceeding the size of total issue divisible by Rs. 50,000. In total, 85 per cent (Rs. 8.5 billion) of the bond amount is allotted for competitive bidders, while the remaining 15 per cent for the non-competitive bidders, reads the bank’s notice. The group classified as ‘A”, ‘B”, or ‘C’ banks and financial institutions licensed from NRB would not participate as non-competitive bidders, according to the notice. The interest rate of the bond will be determined after reviewing the interest rates proposed by the participants of the competitive bids. The applicants must also deposit 2.5 per cent of the bid amount on the central bank’s account as urgent money, in addition to submitting deposit voucher to PDMD by 3:00 P.M. The NRB said that it would refund money to the bidders who do not get selected or the amount exceeding the required allotment within seven days of their allotments without any interest. The bond holders can take loans as collateral. The secondary trading of the bond will be transacted through Nepal Stock Exchange (NEPSE). The development bond is part of the domestic debt, which the government plans to mobilise so as to make up for deficit in its budget. Treasury bills, development bonds, citizen saving bonds, national saving bonds and foreign employment bonds are the instruments the NRB uses to raise internal debt for the government.