chhatramani/nepal_legal_acts_corpus_english huggingface dataset:
Nepal Rastra Bank Act, 2002

23. Constitution and Functions, Duties of Investigation Committee: (1) Before removing the Governor under sub-section (2) of Section 22, the Government of Nepal shall constitute an Investigation Committee as follows and remove the Governor on its recommendation:

(a) A person designated by the Government of Nepal from among former justices of the Supreme Court - Chairperson
(b) Two persons designated by the Government of Nepal from among distinguished persons in the fields of economics, monetary, banking, finance, commerce and management - Members

(2) The Investigation Committee may take statements or conduct inquiries with the concerned person before submitting its recommendation along with its opinion to the Government of Nepal.

(3) The Investigation Committee may determine its own procedure to be followed in the course of the investigation.

(4) The Investigation Committee shall submit its recommendation along with its opinion to the Government of Nepal within one month. 24. Resignation of Directors: The Governor, Deputy Governor or Director may resign from their post by submitting a written resignation to the Government of Nepal. 25. Public Notice of Appointment of Governor: The Government of Nepal shall, generally at least one month before the post of the sitting Governor falls vacant, appoint the Governor under this Act and publish and disseminate a notice thereof publicly. 26. Filling of Vacancies: If the post of any Governor, Deputy Governor or Director falls vacant before the completion of the term, the Government of Nepal shall, after completing the procedure under this Act, appoint a suitable person for the remaining period. 27. Acting Arrangement: If the Governor is unable to perform the functions of the Bank due to death, resignation, illness, leave or any other reason, the Government of Nepal shall designate the senior-most Deputy Governor of the Bank as the Acting Governor to perform the functions of the Governor. 28. Board Meetings: (1) The Governor shall preside over meetings of the Board.

(2) Meetings of the Board may be held as required by the Bank. Provided, however, that a meeting of the Board shall be held at least once a month.

(3) The Governor shall call meetings of the Board. Provided, however, that if three Directors of the Board submit a written request to call a meeting of the Board, the Governor shall call such meeting.

(4) The Board may make separate regulations relating to calling, conducting, voting, recording minutes and other procedures of its meetings.

(5) The presence of the person chairing the meeting and at least three Directors shall constitute a quorum for a meeting of the Board.
Nepal Rastra Bank Act, 2002

Provided, however, that one of the three Directors must be a Director appointed under clause (d) of Section 14.

(6) A decision of the majority shall be the decision of the Board. In the event of a tie of votes for and against a proposal, the person presiding shall have a casting vote. 29. Functions, Duties and Powers of the Board: The functions, duties and powers of the Board shall be as follows:

(a) To formulate monetary and foreign exchange policies.
(b) To make necessary decisions regarding the denomination, design, size, metal, paper or other material for printing bank notes and coins, and to formulate necessary policies regarding their issuance.
(c) To make arrangements for the inspection and supervision of commercial banks and financial institutions, and to formulate necessary policies regarding the banking and financial system.
(d) To approve rules and regulations of the Bank and to formulate policies applicable to the operation and management of the Bank.
(e) To determine policies regarding the appointment, promotion, transfer, dismissal, remuneration, pension, gratuity, provident fund, leave, conduct and other terms of service of the employees of the Bank.
(f) To approve the annual program and budget and the annual audited accounts for the Bank, and to submit the report thereof to the Government of Nepal for information.
(g) To approve the annual report on the operations of the Bank.
(h) To formulate policies regarding the issuance and revocation of licenses to commercial banks and financial institutions.
(i) To approve the limit of loans to be provided by the Bank to the Government of Nepal.
(j) To determine the amount, limit and conditions of loans and refinancing to be provided by the Bank to commercial banks and financial institutions.
(k) To decide on the membership of the Bank in international associations and organizations.
(l) To formulate policies for the mobilization and investment of the Bank's financial resources.
(m) If the need to amend this Act is felt, to submit a proposal to the Government of Nepal stating the reasons therefor.
(n) To decide on all matters other than those falling within the jurisdiction of the Governor under this Act.
(o) To delegate the powers vested in the Board to the Governor or a sub-committee constituted by the Board, with or without prescribing a period. 30.
Nepal Rastra Bank Act, 2002

30. Functions, Duties and Powers of the Governor: (1) The functions, duties and powers of the Governor shall be as follows:

(a) To implement the decisions made by the Board.
(b) To operate and manage the Bank.
(c) To organize the functions to be performed by the Bank.
(d) To represent or cause to represent the Bank in international associations and organizations.
(e) To implement or cause to implement monetary and foreign exchange related policies.
(f) To determine necessary policies regarding interest rates on deposits and loans with commercial banks and financial institutions.
(g) To determine necessary policies regarding the interest rates to be charged or paid by commercial banks and financial institutions on loans or deposits.
(h) To formulate policies regarding liquidity to be maintained by commercial banks and financial institutions.
(i) To make necessary arrangements regarding the basis, amount, manner, conditions, time period and use of the cash reserve ratio to be maintained by commercial banks and financial institutions.
(j) To determine conditions regarding capital adequacy for commercial banks and financial institutions.
(k) To decide on the procedure and conditions to be adopted for the purchase and sale of gold and other precious metals.
(l) To determine service fees for services provided by the Bank.
(m) To decide on the establishment and closure of branch offices and other offices of the Bank as required.
(n) To establish and close agencies of the Bank.
(o) To make necessary arrangements regarding the development and operation of the Bank's information system.
(p) To make necessary arrangements regarding the supervision of commercial banks and financial institutions.
(q) To decide on the revocation of licenses granted to commercial banks and financial institutions.
(r) To decide on other matters subject to the powers delegated by the Board of Directors.

(2) The Governor shall have inherent powers that a central bank governor should exercise in accordance with international norms. 31. Delegation of Powers: The Governor may delegate the authority obtained under this Act to a Deputy Governor or other employees of the Bank for the smooth operation of the Bank's work. 32. Restriction on Use of Vested Personal Interest: (1) After being appointed to the post of Governor, Deputy Governor or Director, every six months, the Governor, Deputy Governor and Director shall, if they have any direct or indirect commercial interest of themselves or their family members, inform the Board about that matter as prescribed.

(2) If a proposal in which the Governor, Deputy Governor or Director has a personal interest is to be discussed in the Board, the concerned person shall inform the Board about that matter before the commencement of such discussion.
Nepal Rastra Bank Act, 2002

Such Director shall not participate in that discussion.

(3) Removed by the Second Amendment

(4) The Governor and Deputy Governor shall make public their immediate family's property details within one month from the date of appointment to the post and from the date of removal from the post. 33. Management Committee: (1) To ensure smooth operation of the functions to be performed by the Bank, a Management Committee shall be constituted under the chairpersonship of the Governor and under the authority of the Board. The other members of the Management Committee shall be two Deputy Governors and a senior officer of the Bank designated by the Governor to act as Member Secretary.

(2) The functions, duties and powers of the Management Committee constituted under sub-section (1) shall be as prescribed.

(3) Notwithstanding anything contained in sub-section (1), the Governor may invite any other officer of the Bank to participate in the meeting

50. Discount Rate and Refinancing Interest Rate: The Bank shall determine the discount rate and the refinancing interest rate from time to time. The Bank shall publish and disseminate the information of the discount rate and refinancing interest rate so determined for the information of all concerned. Chapter 6
Monetary Unit, Bank Notes and Coins

51. Monetary Unit: (1) The monetary unit of Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. shall be the Rupee, and such Rupee shall be divided into one hundred Paisa.

(2) The Rupee as per sub-section (1) shall be legal tender within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. and such Rupee shall be guaranteed by the Government of Nepal. 52. Right to Issue Bank Notes and Coins: (1) The Bank shall have the sole right to issue bank notes and coins within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. . Such notes and coins shall be legal tender in Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. .

(2) When issuing notes pursuant to sub-section (1), the Bank shall issue them only upon maintaining security, and the liability of such issued notes shall be equal to the value of the property kept as security. At least fifty percent of the property kept as security shall be in one or more of gold, silver, foreign currency, foreign securities, and foreign exchange certificates, and the remaining percentage shall be in one or more of coins (of Mohar, Double and higher denominations), bonds issued by the Government of Nepal, and promissory notes or bills of exchange payable within Nepal within a maximum of eighteen months from the date of re-discount by the Bank.
Nepal Rastra Bank Act, 2002

Provided that, if approved by the Government of Nepal, at least forty percent of the property kept as security may be in one or more of gold, silver, foreign currency, foreign securities, and foreign exchange certificates, and the remaining percentage may also be in one or more of Nepali coins (of Mohar, Double and higher denominations), bonds issued by the Government of Nepal, and promissory notes or bills of exchange payable within Nepal within a maximum of eighteen months from the date of re-discount by the Bank.

(3) For the purpose of sub-section (2), the valuation of property shall be made as follows:-
(a) The value of gold at the rate determined by the Government of Nepal upon the recommendation of the Committee.
(b) The value of silver at the rate determined reasonable by the Committee.
(c) Foreign currency at the exchange rate determined by the Bank.
(d) Bonds issued by the Government of Nepal, foreign securities, and exchange certificates at the rate determined reasonable by the Committee considering the market rate.
(e) Coins at their face value.

(4) The Bank shall issue bank notes of various denominations as required. When issuing bank notes in this manner, visible images, size, and denominations on the notes shall be with the approval of the Government of Nepal, and non-visible images, internal security arrangements, material for printing bank notes, and other substances shall be as decided by the Committee.

(5) The Government of Nepal may, after obtaining the opinion of the Committee, publish a notice in the Nepal Gazette and demonetize bank notes of any denomination in any place or region other than a specified place or region.

(6) The Bank shall not re-issue torn, erased, or worn-out notes.

(7) The Bank may, with the approval of the Government of Nepal, have coins of any value, size, weight, fineness, design, and metal or alloy minted at the mint and put them into circulation for general use or on special occasions. The Bank may, if deemed necessary, have such coins minted at a foreign mint as well. Provided that, if coins already minted once with approval need to be minted again, the approval of the Government of Nepal shall not be required.

(8) The Bank may, with the approval of the Government of Nepal, mint coins sent by any foreign government for minting.

(9) The Bank shall be responsible for redeeming notes issued by the Government of Nepal before the establishment of the Bank and bank notes issued by the Bank.

(10) No liability other than the liability pursuant to sub-section (9) shall be satisfied from the property held as security for the issuance of bank notes. 53.
Nepal Rastra Bank Act, 2002

53. Bank Notes and Coins to be Universally Accepted: Bank notes and coins issued as legal tender by the Bank shall be universally accepted within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. for the discharge of all types of public and private debts up to the amount indicated on such note or coin. 54. Size, Weight and Shape of Coins: The value, size, weight, shape, and other characteristics to be inscribed on coins issued by the Bank pursuant to this Act shall be as prescribed by the Committee. 55. Currency Issuance and Security: Arrangements relating to printing bank notes and minting coins, providing appropriate security for the safekeeping of unissued bank notes and coins, and securely storing or destroying old bank notes or coins, plates, and dies not in circulation shall be as prescribed. 56. Currency Exchange Arrangements: The Bank shall exchange bank notes or coins that are legal tender within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. for bank notes or coins of the same value of the same or different denominations, without any fee or charge. 57. Worn or Defaced Currency: (1) The Bank may call in, destroy, or exchange worn currency for other bank notes or coins.

(2) Notwithstanding anything contained in sub-section (1), the Bank may refuse to exchange bank notes or coins whose design is erased, torn, mutilated, or where more than fifty percent of the note or coin is missing.

(3) The Bank may call in or destroy such bank notes or coins pursuant to sub-section (1), with or without paying compensation to the owner as prescribed.

(4) The owner of a lost or stolen bank note or coin shall not be entitled to compensation from the Bank. The Bank may forfeit, without any compensation, coins whose external appearance has been altered or which are defaced, or counterfeit notes. Explanation: For the purpose of this section, "defaced coin" means a counterfeit coin minted, cast, or engraved in imitation of a coin issued by the Bank, or a coin issued by the Bank that has been cut into more than two pieces, broken, or whose inscribed numbers, letters, or symbols have been erased. 58. Arrangements Relating to Currency Stock and Issuance: The Bank shall make arrangements relating to the stock and issuance of currency and shall regularly supply bank notes and coins to meet the demand for currency. 59. Accounting for Issued Currency: The Bank shall show separately in its accounts the total bank notes Deleted by the Second Amendment. in circulation as a monetary liability.
Nepal Rastra Bank Act, 2002

59. Accounting for Issued Currency: The Bank shall show separately in its accounts the total bank notes Deleted by the Second Amendment. in circulation as a monetary liability. Bank notes Deleted by the Second Amendment. and coins held in stock or not yet put into circulation shall not fall under such liability. 60. Calling in or Withdrawing Issued Currency: (1) The Bank may call in or withdraw bank notes and coins in circulation within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. upon providing reimbursement. The Bank shall publish and disseminate a public notice clearly specifying the period within which the bank notes and coins being called in or withdrawn must be presented for reimbursement at which office of the Bank.

(2) Notwithstanding anything contained in section 53, bank notes and coins which require reimbursement after the expiry of the period specified pursuant to sub-section (1) shall not be legal tender.

(3) The Bank may pulverize, cut, break, or destroy in any other manner the bank notes and coins called in from circulation pursuant to sub-section (1) and defective currency, as prescribed. 61. Reproduction and Counterfeit Currency: (1) No person shall do or cause to be done any of the following acts:-
(a) To make counterfeited or forged legal tender bank notes and coins in circulation within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. , or checks or payment cards, or to reproduce them by altering their form or in any other manner, or to do any act related thereto, or to abet any such act; or
(b) To keep in possession, transport, or issue, or to abet any such act, any such bank notes, coins, checks, or payment cards, knowing them to be counterfeit, worn, forged, or made by altering their form; or
(c) To keep in possession, produce, or transport, or to abet any such act, any metal sheet, stone, paper, die, or any other object or substance, knowing it to be used for making counterfeit, false, forged, or altered bank notes, coins, checks, or payment cards.

(2) When reproducing bank notes, coins, checks, or payment cards denominated in Nepali Rupees, or creating any object, if the design of such object is in any way likely to resemble a bank note, coin, check, or payment card, prior approval of the Bank must be obtained before doing so.

(3) The Bank may take necessary steps to prevent the issuance of forged notes or counterfeit coins or fake checks or payment cards. While taking such steps, the Bank may issue necessary orders, directives, or notices. Chapter 7
Foreign Exchange Policy, Regulations and Reserves

62.
Nepal Rastra Bank Act, 2002

While taking such steps, the Bank may issue necessary orders, directives, or notices. Chapter 7
Foreign Exchange Policy, Regulations and Reserves

62. Foreign Exchange Policy: The Bank shall have full authority to formulate and implement or cause to be implemented the foreign exchange policy of Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. . 63. Foreign Exchange Management: The Bank shall manage foreign exchange. For such management, the Bank shall have the following powers:-
(a) To issue licenses to persons wishing to undertake foreign exchange transactions, subject to this Act or other prevailing laws.
(b) To make rules and regulations and issue necessary orders, directives, or notices to regulate and systematize foreign exchange transactions conducted by licensed persons.
(c) To inspect, supervise, and monitor licensed persons.
(d) To determine the basis, limits, and conditions of transactions of licensed persons.
(e) To prescribe the system for determining the exchange rate of the Nepali Rupee against foreign currencies. 64. Details of Foreign Exchange Transactions: (1) The Bank shall require licensed persons to submit to the Bank detailed particulars of foreign currency exchange and related operations. The period for submission of such particulars, the format, and related other documents shall be as prescribed by the Bank from time to time.
(2) It shall be the duty of the concerned licensed person to submit the particulars and documents specified by the Bank pursuant to sub-section (1) to the Bank. 65. Foreign Exchange Transactions: (1) The Bank may buy or sell foreign exchange, gold, and precious metals.
(2) The Bank may conduct purchases and sales pursuant to sub-section (1) through spot, forward exchange rate, swap, option, or other instruments of a similar nature, cash, or any means of exchange.
(3) The Bank may buy or sell foreign exchange for the purpose of sub-section (1) of section 66. Such purchase or sale may be based on spot, forward exchange rate, swap, option, or other similar instruments.
(4) The Bank shall transact by fixing buying and selling rates for foreign currencies. The basis, limits, and conditions of transactions conducted in this manner shall be as prescribed by the Bank. 66. Foreign Exchange Reserves: (1) The Bank shall mobilize foreign exchange reserves.
Nepal Rastra Bank Act, 2002

The basis, limits, and conditions of transactions conducted in this manner shall be as prescribed by the Bank. 66. Foreign Exchange Reserves: (1) The Bank shall mobilize foreign exchange reserves. Such reserves shall be denominated in the relevant foreign exchange and shall comprise the following assets:-
(a) Gold and precious metals held by or deposited in the Bank's account.
(b) Foreign currency held by or deposited in the Bank's account.
(c) Foreign currency held in accounts with foreign central banks or other foreign banks in the name of the Bank.
(d) Special Drawing Rights (SDRs) credited to the Bank's account with the International Monetary Fund.
(e) Bills of exchange, promissory notes, savings bonds, bonds, and other debt securities issued by any debtor or obligor, payable in foreign exchange, held by the Bank.
(f) Agreements made between the Bank and another party for immediate or repurchase from foreign banks or international financial institutions, or with their guarantee, and for future purchase, payable in foreign exchange.
(2) While selecting assets pursuant to sub-section (1), the Bank must do so in a manner that maximizes income, keeping in mind the security of the Bank's capital and liquidity.
(3) While implementing monetary and foreign exchange policy, the Bank must maintain adequate international reserves necessary for prompt payment in international transactions.
(4) If the Bank suspects that a decrease or impending decrease in the level of international reserves could adversely affect the process of prompt payment in international transactions while implementing monetary and foreign exchange policy, the Bank shall submit a report to the Government of Nepal stating the current status of international reserves, the reasons for the decrease, and the measures to be adopted to prevent it.
(5) Until the situation mentioned in sub-section (4) improves, the Bank shall prepare and submit reports with further suggestions as necessary to the Government of Nepal.
(6) The Bank shall show the foreign exchange reserves pursuant to sub-section (1) in its balance sheet. 67. Issuance of Bonds in Gold and Foreign Currency: (1) The Bank may, with the approval of the Government of Nepal, issue one or more types of bonds denominated in gold and foreign currency for specific purposes.
(2) The type, tenure, principal, interest payment, and other matters of bonds issued pursuant to sub-section (1) shall be as prescribed by the Bank. 68. International Clearing and Payment Agreements: The Bank may enter into clearing and payment agreements with public or private central clearing institutions situated abroad for its own account or for government accounts as directed by the Government of Nepal. The Bank may also enter into other agreements necessary for implementing the objectives of such agreements.
Nepal Rastra Bank Act, 2002

The Bank may also enter into other agreements necessary for implementing the objectives of such agreements. Chapter 8
Relationship with the Government of Nepal

69. Banker, Advisor and Financial Agent: (1) The Bank shall be the banker, economic advisor, and financial agent of the Government of Nepal for Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. .
(2) The Government of Nepal shall consult with the Bank on matters related to the Bank's jurisdiction. It shall be the duty of the Bank to provide advice on matters requested by the Government of Nepal in this manner.
(3) Each year, while preparing the annual budget, the Government of Nepal shall consult with the Bank regarding internal debt including overdraft.
(4) The Bank shall submit a pre-budget review report on economic and financial matters to the Government of Nepal each year. 70. Consultation and Information Regarding External Debt: (1) The Government of Nepal may consult with the Bank when borrowing from abroad.
(2) Consultation pursuant to sub-section (1) shall include matters such as the amount of the loan, its terms of receipt, conditions of borrowing, and repayment of the loan.
(3) The Government of Nepal shall inform the Bank of any external borrowing undertaken.
(4) The Government of Nepal shall consult with the Bank when approving external borrowing by private or public entities that creates a liability in foreign exchange.
(5) The Government of Nepal, public entities, or the private sector shall inform the Bank of agreements made that create a liability in foreign exchange. 71. Deposit Collection: (1) The Bank shall accept deposits of the Government of Nepal or other bodies specified by the Government of Nepal.
(2) While accepting deposits pursuant to sub-section (1), the Bank shall perform functions such as taking custody of funds, making payments, operating accounts, and providing other banking services.
(3) The Bank may authorize commercial banks and financial institutions, as necessary, subject to conditions prescribed by the Bank, to conduct transactions pursuant to sub-section (2). 72. Functions as Financial Agent: The Bank shall act as the financial agent of the Government of Nepal in the following matters, subject to the conditions or limits determined based on agreements with the Government of Nepal:-
(a) Transactions such as purchasing and selling bonds issued by the Government of Nepal, making market arrangements, transferring them, and maintaining records thereof.
(b) Payment of principal, interest, and other charges on bonds pursuant to clause (a).
(c) Other necessary functions to be performed as agent. 73.
Nepal Rastra Bank Act, 2002

73. Bank may Request Details, Statistics and Documents: (1) The Bank may request details, statistics, and documents necessary for conducting its business from the concerned body.
(2) It shall be the duty of the concerned body to provide the details, statistics, and documents requested by the Bank pursuant to sub-section (1). 74. Consultation with Bank Regarding Law Reform: (1) Before amending or enacting laws concerning matters within the Bank's objectives or jurisdiction, such as monetary policy and operations, credit, balance of payments, foreign exchange, and banking, or undertaking related actions, the concerned body may consult with the Bank.
(2) It shall be the duty of the Bank to provide advice requested pursuant to sub-section (1).
(3) The Bank shall have the right to submit proposals to the Government of Nepal for enacting new laws or amending existing laws on matters within its objectives, jurisdiction, or competence, such as monetary policy and operations, credit, balance of payments, foreign exchange, and banking. 75. Credit to the Government of Nepal and Purchase of Government Securities: (1) Except as otherwise provided in this Act, the Bank shall not provide any type of financial assistance to the Government of Nepal or to entities wholly, majority, or partially owned by the Government of Nepal.
(2) Subject to this section, the Bank may provide credit to the Government of Nepal repayable within one hundred and eighty days.
(3) Notwithstanding anything contained in sub-section (2), the Bank may provide special long-term credit to the Government of Nepal for fees payable or related payments upon Nepal's membership in any international institution.
(4) The Bank shall disburse credit provided to the Government of Nepal or entities wholly, majority, or partially owned by the Government of Nepal only in Nepali Rupees. For credit provided in this manner, the Government of Nepal shall issue and provide to the Bank exchange bonds equivalent to the credit amount. The repayment period of such bonds must cover the credit period and bear the prevailing interest rate. There shall be a written agreement between the Bank and the Government of Nepal regarding all credit provided by the Bank to the Government of Nepal. Such written agreement must clearly mention the total amount or limit of credit, its terms, repayment period, interest rate, and other charges. Explanation: For the purpose of this section, "exchange bond" means a bond issued in the form of a promissory note.

(5) The overdraft extended by the Bank to the Government of Nepal shall not at any time exceed five percent of the revenue income of the Government of Nepal of the preceding fiscal year.
Nepal Rastra Bank Act, 2002

When calculating such revenue income, loans, grants, or any other type of financial assistance, and income from the sale of assets shall not be included.
(6) The Government of Nepal must repay the overdraft pursuant to sub-section (5) within one hundred and eighty days in cash or through marketable bonds at the prevailing market interest rate.
(7) The total amount of bonds purchased by the Bank from the Government of Nepal and held in its ownership shall not exceed ten percent of the revenue income of the preceding fiscal year.
(8) Bonds issued by the Government of Nepal purchased by the Bank in the following circumstances shall not be considered as credit provided to the Government of Nepal pursuant to sub-section (7):-
(a) Purchased from the secondary market for open market operations in line with the Bank's monetary policy.
(b) Purchased during primary issuance with the intention of selling within sixty days, as deemed necessary by the Bank to maintain the market at an appropriate level.
(c) In respect of bonds purchased by the Bank from the Government of Nepal and held in its ownership before sub-section (7) became applicable. Chapter 9
Regulation, Inspection, and Supervision of Banks

76. Bank's Approval Required to Accept Deposits or Grant Loans: (1) Any person, firm, company, or institution must obtain approval from the Bank as prescribed to accept deposits of any kind or grant loans.
(2) While granting approval pursuant to sub-section (1), the Bank may prescribe necessary conditions as prescribed, and it shall be the duty of the concerned person, firm, company, or institution to comply with such conditions. 77. Restriction on Interest Rate: While determining interest rates to be paid on deposits or charged on loans, persons, firms, companies, or institutions authorized by prevailing law to accept deposits or grant loans must do so in accordance with the provisions relating to interest rates prescribed by the Bank from time to time. 78. License Required from Bank: (1) Commercial banks and financial institutions must obtain a license from the Bank as prescribed to conduct banking and financial transactions.
(2) While granting a license pursuant to sub-section (1), the Bank may prescribe necessary conditions as prescribed, and it shall be the duty of the concerned licensed bank or financial institution to comply with such conditions. 79.
Nepal Rastra Bank Act, 2002

79. Bank to Regulate: (1) The Bank shall have full authority to regulate the work and operations of commercial banks and financial institutions.
(2) In relation to regulation pursuant to sub-section (1), the Bank may make rules and regulations and issue necessary orders, directives, and notices on matters it deems necessary, and it shall be the duty of the concerned commercial bank or financial institution to comply with such rules, regulations, orders, directives, and notices.
(3) The Bank shall issue necessary directives to commercial banks and require them to submit the following details:-
(a) Details of on-balance sheet accounts and bookkeeping, off-balance sheet accounts or commitments, income and expenditure, and their proportional relationship with account headings.
(b) Conditions, restrictions, or prohibitions imposed on specific types of credit or investments not falling within limits set by the Bank, or periodic reconciliation of such credit or investment and risk-bearing commitments, assets and liabilities, and off-balance sheet items, foreign currency position, spot and forward exchange rates, swaps, options, or other similar instruments, and other processes of electronic or other payment systems.
(c) Other details and documents prescribed by the Bank.
(4) The Bank shall issue necessary directives to financial institutions and require them to submit the following details:-
(a) Accounts, bookkeeping, profit and loss accounts, balance sheet and off-balance sheet transactions and commitments, income and expenditure details, and their proportional relationship with account headings.
(b) Conditions, restrictions, or prohibitions imposed on specific types of credit or investments, or credit or investments exceeding limits set by the Bank, risky commitments, foreign currency position, payment and payment system electronic or other processes.
(c) Other details and documents prescribed by the Bank.
Nepal Rastra Bank Act, 2002

Added by the Second Amendment. (4a) The Bank may issue necessary directives to commercial banks and financial institutions for the purpose of preventing money laundering and terrorist financing, regarding customer identification and customer risk classification and management, fund transfers, limits including deposits, or providing details of suspicious transactions to the Financial Information Unit established pursuant to the prevailing anti-money laundering law.

(5) The Bank shall have the following powers with respect to commercial banks and financial institutions:-
(a) To exercise the powers and duties conferred by this Act and any other Act enacted to license, supervise, and regulate commercial banks and financial institutions, to cancel licenses of commercial banks and financial institutions, and to take over or place under trusteeship commercial banks or financial institutions that are about to become insolvent or have become insolvent.
(b) To inspect, examine, or supervise, or cause to be inspected, examined, or supervised, through any officer of the Bank or person designated by the Bank, the books of account, records, documents, or other registers of any commercial bank or financial institution to ascertain whether it is conducting transactions in accordance with this Act or the rules, regulations, or orders or directives issued under this Act.
(c) To order members of the board of directors, officials, or employees of any commercial bank or financial institution to submit necessary information about their bank or institution if inspection or supervision of its transactions is required. 80. Banking and Financial System and Credit Control: The Bank may issue directives from time to time to commercial banks and financial institutions regarding the banking and financial system, currency, and credit. It shall be the duty of commercial banks and financial institutions to comply with such directives. 81. Credit Flow Required to Specified Sectors: (1) Commercial banks and financial institutions must provide credit to sectors specified by the Bank from time to time, for the period specified by the Bank, and in the manner specified by the Bank.
(2) If any commercial bank or financial institution fails to provide credit or provides less credit than required pursuant to sub-section (1), the Bank may levy a penalty on the concerned commercial bank or financial institution amounting to the interest calculated at the maximum lending interest rate of that institution on the amount not provided or provided in deficit. 82. Information to be Submitted to Bank: (1) Commercial banks and financial institutions must submit details of their transactions and financial condition to the Bank as prescribed by the Bank.
(2) The Bank may publish the details obtained pursuant to sub-section (1). 83.
Nepal Rastra Bank Act, 2002

82. Information to be Submitted to Bank: (1) Commercial banks and financial institutions must submit details of their transactions and financial condition to the Bank as prescribed by the Bank.
(2) The Bank may publish the details obtained pursuant to sub-section (1). 83. Approval Required to Issue Debentures and Financial Instruments: (1) Commercial banks and financial institutions must obtain prior approval of the Bank to issue any type of debenture or financial instrument.
(2) While granting approval pursuant to sub-section (1), the Bank may specify necessary conditions, and it shall be the duty of the concerned commercial bank or financial institution to comply with such conditions. 84. Inspection and Supervision: (1) For the purpose of inspection and supervision of commercial banks and financial institutions licensed by the Bank, the Committee shall make and implement international-level inspection and supervision regulations.
(2) The Bank may, at any time, inspect or supervise, or cause to be inspected or supervised, any office of commercial banks and financial institutions. Such inspection and supervision may be conducted by deputing any officer of the Bank or expert designated by the Bank to the concerned office, or by calling detailed particulars and information to the Bank itself.
(3) It shall be the duty of the concerned commercial bank or financial institution, or its director, official, or employee, to provide or make available for inspection or examination to the officer, expert, or the Bank, within the time specified by such officer, expert, or the Bank, the ledgers, statistics, details, information, data required for computer audit, and other programs, details, and financial control systems created through electronic means, or any other necessary documents required by the officer, expert, or the Bank conducting inspection or supervision pursuant to sub-section (2).
(4) The officer or the Bank conducting inspection and supervision pursuant to this section may require any director, official, or employee of a commercial bank or financial institution to give a written statement regarding operations deemed necessary during the inspection and supervision.
(5) Regarding matters deemed necessary during inspection and supervision, the Bank or the inspecting/supervising officer may issue necessary directives to the commercial bank or financial institution. It shall be the duty of the concerned commercial bank and financial institution to comply with the directives issued in this manner by the Bank or the inspecting/supervising officer. The inspecting/supervising officer must inform the Bank of the directives so given as soon as possible.
Nepal Rastra Bank Act, 2002

It shall be the duty of the concerned commercial bank and financial institution to comply with the directives issued in this manner by the Bank or the inspecting/supervising officer. The inspecting/supervising officer must inform the Bank of the directives so given as soon as possible. Amended by the Second Amendment. (6) The officer or expert conducting inspection and supervision pursuant to this section must submit a report of the inspection and supervision conducted to the Governor within the prescribed period.
(7) The report submitted pursuant to sub-section (6) must be presented at the next meeting of the Committee.
(8) The Committee may make necessary decisions on the report submitted pursuant to sub-section (7) and issue necessary directives to the Governor regarding the steps to be taken in relation thereto. The Governor shall be responsible for complying with or causing compliance with such directives. 85. Exchange of Mutual Cooperation: (1) For the purpose of supervising commercial banks and financial institutions falling under their respective supervisory jurisdictions, the Bank may exchange cooperation on a reciprocal basis with the concerned foreign supervisory authority.
(2) Information or intelligence obtained for the purpose of supervision pursuant to sub-section (1) may be exchanged by the Bank with foreign supervisory authorities without breaching confidentiality.
(3) The Bank may exchange mutual cooperation with other bodies regulating policies related to the financial system for the purpose of promoting the financial system. Repealed by the Second Amendment. 86. Added by the First Amendment. 86a. Commercial Bank or Financial Institution to Inform Bank: If any commercial bank or financial institution is in a position to become insolvent or be liquidated under prevailing law, or if such bank or financial institution is unable to pay any amount due or is materially unable to fulfill any or all of its obligations, such commercial bank or financial institution shall immediately inform the Bank thereof within fifteen days. Added by the First Amendment. 86b.
Nepal Rastra Bank Act, 2002

Added by the First Amendment. 86b. When a Commercial Bank or Financial Institution is Deemed Problematic: If the Bank receives information pursuant to section 86a, or if from an inspection and supervision report under section 84 or from any other manner the Bank is satisfied that any of the following conditions exist in any commercial bank or financial institution, the Bank shall, by giving written notice, declare such commercial bank or financial institution as a problematic commercial bank or financial institution:-
(a) If it appears to have acted against the interests of depositors, shareholders, creditors, or the general public,
(b) If it fails or is likely to fail to fulfill its financial obligations or is unable to pay amounts due,
(c) If it is or is about to become insolvent or is experiencing significant financial difficulty,
(d) If it appears to have disobeyed or violated this Act, prevailing law relating to commercial banks and financial institutions, other prevailing laws, conditions specified while granting the license, or the Bank's regulations, directives, or orders,
(e) If it appears to have obtained the license by submitting false, fraudulent, or incorrect documents or facts,
(f) If it fails to maintain the minimum capital fund as per this Act, prevailing law relating to commercial banks and financial institutions, and directives issued by the Bank from time to time,
(g) If liquidation Added by the Second Amendment. or winding-up or insolvency-related legal proceedings have been initiated against any commercial bank or financial institution under prevailing law,
(h) If voluntary liquidation proceedings have commenced and there is undue delay in completing such proceedings,
(i) In the case of a commercial bank or financial institution established with the involvement of a foreign commercial bank or financial institution, if such foreign commercial bank or financial institution becomes insolvent or is liquidated, or a liquidator is appointed upon liquidation, or its license to conduct banking business is revoked under the law of the relevant country, or its operations are partially or fully restricted, or if it appears to be conducting banking business jointly with such commercial bank or financial institution, or
(j) If the Bank is satisfied that conditions exist which adversely affect the payments or obligations or duties of the commercial bank or financial institution. Amended by the Second Amendment. 86c.
Nepal Rastra Bank Act, 2002

Provided that, if it appears that giving such opportunity would adversely affect the interests of the commercial bank or financial institution or its depositors, shareholders, creditors, or the general public, this sub-section shall not be deemed to prevent ordering the immediate removal of such director, manager, or employee from his/her position or service, or suspending the board of directors and providing an opportunity for a hearing as soon as possible, notwithstanding anything contained in prevailing law.

(3) If, upon hearing concerning the action mentioned in the proviso to sub-section (2), such action does not appear reasonable, the Bank may annul, modify, or make another reasonable decision regarding the order under clause (m) or (o) of sub-section (1).

(4) When the Bank takes control of any commercial bank or financial institution pursuant to clause (o) of sub-section (1) and conducts or causes to be conducted its management and operations by any means mentioned in that clause, all expenses incurred shall be borne by the concerned commercial bank or financial institution.

(5) The duration of an order issued by the Bank pursuant to clause (o) of sub-section (1) shall generally remain in effect for up to two years, unless extended by another such order by the Bank.

(6) Where the Bank has taken control of any commercial bank or financial institution pursuant to clause (o) of sub-section (1), an initial report thereof, and subsequently annual reports prepared by the Bank or the officer appointed by the Bank, shall be sent to the Government of Nepal for its information.

(7) An order issued pursuant to clauses (e), (m), (o), and (p) of sub-section (1) may be withdrawn or annulled by another order if the Bank deems it necessary.
Nepal Rastra Bank Act, 2002

When issuing another order in this manner, the basis and reasons for issuing such order and other necessary matters shall be mentioned in the order.

(8) Directors, managers, or employees removed by order of the Bank pursuant to clause (m) of sub-section (1) shall not be entitled to serve as director, manager, or employee of such commercial bank or financial institution, or hold any position in any commercial bank or financial institution, or be directly or indirectly associated in any manner whatsoever with any work or transaction thereof.

(9) Any director, manager, or employee removed pursuant to clause (m) of sub-section (1), or members of the board of directors suspended pursuant to clause (o

(ङ) Subject to the criteria prescribed by the Bank, to increase capital by selling shares to other persons so as to reduce the participation of the existing shareholders, or to restructure such commercial bank or financial institution by restructuring the board of directors,

(च) To reduce the capital so as to reflect the real value of the assets of such commercial bank or financial institution pursuant to Section 86ja, and to adjust the face value of the shares proportionally to such capital,

(छ) To carry out necessary managerial restructuring for the interest of depositors, shareholders, creditors and the public, or to close the branches and operations of a commercial bank or financial institution that is unable to conduct business smoothly and carry out institutional restructuring,

(ज) To adopt or cause to adopt such other measures as prescribed by the Bank to make the problem commercial bank or financial institution viable.

(2) When any decision has to be taken against a commercial bank or financial institution pursuant to clause (च) or (छ) of sub-section (1), the concerned parties shall be given a reasonable opportunity of hearing before taking a decision on such matter. Provided that, if the Bank believes that giving an advance opportunity of hearing would adversely affect the interests of its depositors, shareholders, creditors or the public, such decision may be taken and an opportunity of hearing shall be given as soon as possible, and if the Bank is satisfied with the reasons and grounds revealed from the hearing so held, such decision may be modified or revoked as necessary. Added by the First Amendment. 86cha.