Nepal to accept presence of Chinese banks irrespective of size: official

Source: Xinhua| 2017-04-30 20:43:22|Editor: Yamei
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KATHMANDU, April 30 (Xinhua) -- Nepal has been ready to accept the presence of branches of Chinese banks in the country irrespective of their size, provided they fulfill required criteria set by the central bank, a senior official of the Nepal Ratra Bank (NRB) said.

Senior officials of the central bank had recently discussed whether to accept any smaller Chinese financial institutions to open branches here.

"We reached a conclusion that the presence of Chinese banks has been necessary in the country and we should welcome branches of Chinese banks irrespective of their size in China," Chintamani Siwakoti, deputy governor of the NRB, told Xinhua on Sunday.

He said despite increased inquires from the Chinese side, the Nepalese central bank is yet to receive any official proposal from any Chinese bank.

Foreign banks and financial institutions can enter Nepal's banking sector either by partnering with Nepalese investors under joint venture arrangement or by opening their own exclusive branches.

Nepal's law allows foreign banks and financial institutions to hold up to 80 percent of stake in joint venture banks and such banks are allowed to provide all types of banking services in Nepal.

But foreign banks that open their exclusive branches in Nepal are required to assign capital of at least 20 million U.S. dollars. Scope of banking for such branches is also limited as they cannot be involved in retail banking.

"Once the Chinese banks' branches are opened in Nepal, the transactions of goods in Chinese yuan will rise and it will also save cost of carrying U.S. dollar to China for Nepalese traders," said Bishnu Bahadur Khatri, president of Nepal Trans Himalaya Border Commerce Association, a body involved in trade with China.