NP: Financial sector stability DPC

Abstract*

The objectives of the Financial Sector Stability Credit Program for Nepal is to support the implementation of the financial sector reform program initiated by the Nepalese authorities to reduce the vulnerability of the banking sector and increase its transparency. The credit recognizes the important progress made so far by the Nepalese authorities to tackle financial sector vulnerability and supports the acceleration of a medium term reform strategy... Show More

Development Objective

The objective of the credit is to support the implementation of the financial sector reform program initiated by the Nepalese authorities to reduce the vulnerability of the banking sector and increase its transparency.

Key Details

Project Details

Project ID
P129929
Status
Closed
Team Leader
Sabin Shrestha
Borrower 2
N/A

Country
Nepal
Disclosure Date
June 27, 2013
Approval Date
(as of board presentation)
June 27, 2013
Effective Date
September 4, 2013

Total Project Cost 1
US$ 30.00 million
Implementing Agency
N/A
Region
South Asia
Fiscal Year 3
2013

Commitment Amount
US$ 30.00 million
Environmental Category
N/A
Environmental and Social Risk
Not Applicable
Closing Date
December 31, 2013

Last Stage Reached
BANK APPROVED
Last Update Date
July 7, 2014

Notes
1. Total project cost includes funding from World Bank and non-bank sources in US$ millions. Active and Closed projects show current commitments. Proposed (pipeline) and dropped projects show the forecast amount. The commitment amount for projects in the pipeline is indicative and may be modified during the project preparation.
2. Borrower refers to the Borrower of a Loan or Recipient of a Grant.
3. ”Fiscal Year” is the fiscal year in which the project was approved (or dropped if the status is dropped). The World Bank's fiscal year is from July 1 - June 30. For example, a fiscal year of 1996 corresponds to July 1, 1995 - June 30, 1996.

Sectors

Themes

FY17 - Finance

FY17 - Financial Stability89%
- FY17 - Financial Sector oversight and policy/banking regulation & restructuring89%

FY17 - Public Sector Management

FY17 - Public Administration11%
- FY17 - Transparency, Accountability and Good Governance11%

Project Map

Interactive Map

Finances

Financing Plan (US$ Millions)

Financier	Commitments
IDA Credit	30.00

Total Project Financing (US$ Millions)

Product Line	IBRD/IDA
IBRD Commitment	N/A
IDA Commitment	30.00
IBRD + IDA Commitment	30.00

Lending Instrument
Grant Amount	N/A
Total Project Cost**	30.00

Summary Status of World Bank Financing (US$ Millions) as of July 31, 2025

No data available.

Detailed Financial Activity as of July 31, 2025

Download:

Period	Financier	Transaction Type	Amount (US$)
Nov 15, 2022	IDA-52820	Int Charges	3,623.79
Nov 15, 2022	IDA-52820	Int Charges	3,623.79
Nov 15, 2022	IDA-52820	Int Charges	93,008.86
Nov 15, 2022	IDA-52820	Int Charges	93,008.86
May 15, 2023	IDA-52820	Int Charges	1,603.49
May 15, 2023	IDA-52820	Int Charges	1,603.49
May 15, 2023	IDA-52820	Int Charges	99,330.13
May 15, 2023	IDA-52820	Int Charges	99,330.13
May 15, 2021	IDA-52820	Int Charges	106,598.62
May 15, 2021	IDA-52820	Int Charges	106,598.62
May 15, 2021	IDA-52820	Int Charges	240.46
May 15, 2021	IDA-52820	Int Charges	240.46
Nov 15, 2020	IDA-52820	Int Charges	1,402.07
Nov 15, 2020	IDA-52820	Int Charges	1,402.07
Nov 15, 2020	IDA-52820	Int Charges	104,314.69
Nov 15, 2020	IDA-52820	Int Charges	104,314.69
Nov 15, 2021	IDA-52820	Int Charges	746.43
Nov 15, 2021	IDA-52820	Int Charges	746.43
Nov 15, 2021	IDA-52820	Int Charges	104,842.90
Nov 15, 2021	IDA-52820	Int Charges	104,842.90
May 15, 2022	IDA-52820	Int Charges	1,583.54
May 15, 2022	IDA-52820	Int Charges	1,583.54
May 15, 2022	IDA-52820	Int Charges	97,725.17
May 15, 2022	IDA-52820	Int Charges	97,725.17
May 15, 2020	IDA-52820	Int Charges	98.90
May 15, 2020	IDA-52820	Int Charges	98.90
May 15, 2020	IDA-52820	Int Charges	101,444.48
May 15, 2020	IDA-52820	Int Charges	101,444.48
Nov 15, 2018	IDA-52820	Int Charges	1,870.84
Nov 15, 2018	IDA-52820	Int Charges	1,870.84
May 15, 2019	IDA-52820	Int Charges	101,587.02
May 15, 2019	IDA-52820	Int Charges	101,587.02
May 15, 2019	IDA-52820	Int Charges	1,569.36
May 15, 2019	IDA-52820	Int Charges	1,569.36
Nov 15, 2019	IDA-52820	Int Charges	748.49
Nov 15, 2019	IDA-52820	Int Charges	748.49
Nov 15, 2019	IDA-52820	Int Charges	101,724.32
Nov 15, 2019	IDA-52820	Int Charges	101,724.32
May 15, 2018	IDA-52820	Int Charges	823.45
May 15, 2018	IDA-52820	Int Charges	823.45
May 15, 2018	IDA-52820	Int Charges	105,757.46
May 15, 2018	IDA-52820	Int Charges	105,757.46
Nov 15, 2018	IDA-52820	Int Charges	101,236.29
Nov 15, 2018	IDA-52820	Int Charges	101,236.29
May 15, 2017	IDA-52820	Int Charges	2,776.71
May 15, 2017	IDA-52820	Int Charges	2,776.71
May 15, 2017	IDA-52820	Int Charges	97,937.19
May 15, 2017	IDA-52820	Int Charges	97,937.19
Nov 15, 2017	IDA-52820	Int Charges	1,597.36
Nov 15, 2017	IDA-52820	Int Charges	1,597.36
Nov 15, 2017	IDA-52820	Int Charges	105,440.65
Nov 15, 2017	IDA-52820	Int Charges	105,440.65
May 15, 2016	IDA-52820	Int Charges	2,034.34
May 15, 2016	IDA-52820	Int Charges	2,034.34
May 15, 2016	IDA-52820	Int Charges	101,973.50
May 15, 2016	IDA-52820	Int Charges	101,973.50
Nov 15, 2016	IDA-52820	Int Charges	101,754.92
Nov 15, 2016	IDA-52820	Int Charges	101,754.92
Nov 15, 2016	IDA-52820	Int Charges	1,242.59
Nov 15, 2016	IDA-52820	Int Charges	1,242.59
Oct 24, 2013	IDA-52820	Loan Disb	30,801,420.00
Nov 15, 2014	IDA-52820	Int Charges	708.33
Nov 15, 2014	IDA-52820	Int Charges	708.33
Nov 15, 2014	IDA-52820	Int Charges	108,550.13
Nov 15, 2014	IDA-52820	Int Charges	108,550.13
May 15, 2014	IDA-52820	Int Charges	13,428.08
May 15, 2014	IDA-52820	Int Charges	95,589.79
May 15, 2014	IDA-52820	Int Charges	13,428.08
May 15, 2014	IDA-52820	Int Charges	19,508.07
May 15, 2014	IDA-52820	Int Charges	19,508.07
May 15, 2014	IDA-52820	Int Charges	95,589.79
May 15, 2015	IDA-52820	Int Charges	2,659.64
May 15, 2015	IDA-52820	Int Charges	2,659.64
May 15, 2015	IDA-52820	Int Charges	99,644.52
May 15, 2015	IDA-52820	Int Charges	99,644.52
Nov 15, 2015	IDA-52820	Int Charges	3,287.58
Nov 15, 2015	IDA-52820	Int Charges	3,287.58
Nov 15, 2015	IDA-52820	Int Charges	103,286.97
Nov 15, 2015	IDA-52820	Int Charges	103,286.97
Nov 15, 2023	IDA-52820	Int Charges	96,886.19
Nov 15, 2023	IDA-52820	Int Charges	96,886.19
Nov 15, 2023	IDA-52820	Int Charges	855.35
Nov 15, 2023	IDA-52820	Int Charges	855.35
Nov 15, 2023	IDA-52820	Loan Repay	263,943.66
May 15, 2024	IDA-52820	Int Charges	2,087.89
May 15, 2024	IDA-52820	Int Charges	2,087.89
May 15, 2024	IDA-52820	Loan Repay	263,340.70
May 15, 2024	IDA-52820	Int Charges	97,765.19
May 15, 2024	IDA-52820	Int Charges	97,765.19
Jun 27, 2013	IDA-52820	Loan Commitment	30,000,000.00

Footnotes

Ratings

IMPLEMENTATION RATINGS

Name	Review	Date
Program Management	Satisfactory	2013-10-23
Progress towards achievement of PDO	Satisfactory	2013-10-23
Monitoring and Evaluation	Satisfactory	2013-10-23
Overall Implementation Progress (IP)	Satisfactory	2013-10-23

COMPLETION RATINGS

INDICATOR	IMPLEMENTATION COMPLETION & RESULTS REPORT: 09-30-2014
Outcomes	Moderately Satisfactory
Risk to Development Outcome	Modest
Bank Performance	Moderately Satisfactory
Borrower Performance	Moderately Satisfactory
Government Performance	Not Applicable
Implementing Agency	Not Applicable

INDEPENDENT EVALUATION RATINGS

INDICATOR	ICR REVIEW: 06-30-2015	PROJECT PERFORMANCE ASSESSMENT REPORT:
Outcome Rating	Satisfactory	N/a
Risk To Development Outcome	Moderate	N/a
Bank Performance	Satisfactory	N/a
Borrower Performance	Satisfactory	N/a
Government Performance	Satisfactory	N/a
Implementing Agency	Satisfactory	N/a
Icr Quality	Satisfactory	N/a
M&e Quality	Substantial	N/a

Results Framework

PROJECT DEVELOPMENT OBJECTIVE INDICATORS

INDICATOR		BASELINE	CURRENT	TARGET

INTERMEDIATE RESULTS INDICATORS

INDICATOR		BASELINE	CURRENT	TARGET

Consolidation of the financial sector through a decrease in number of financial institutions Value 199.00 174.00 175.00
Date January 15, 2012 July 15, 2013 December 31, 2013
Comment

First phase of recapitalization plan of Nepal Bank Limited is completed	Value	-8.53	-0.49	2.00
	Date	January 15, 2012	July 15, 2013	December 15, 2013
	Comment	CAR is negative.	CAR is negative.	End target was set as positive CAR by the end of first phase of recap plan.

Establishment of a Bank Resolution Unit and approval of Bank Resolution Manual	Value	No	No	Yes
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment	No bank resolution unit and no bank resolution manual	Bank resolution unit established and Problem Bank Resolution Toolkit finalized but yet to be approved by the Board.	Bank resolution unit established and bank resolution manual approved.

First phase of recapitalization plan for Rastriya Banijya Bank is completed	Value	-21.79	3.33	2.00
	Date	January 15, 2012	July 15, 2013	December 15, 2013
	Comment	Capital Adequacy Ratio (CAR) is negative.	CAR is positive through equity injection and conversion of debt into equity by GON.	End target was set as positive CAR by the end of first phase of recap plan.

Initiation of comprehensive diagnostics of financial institutions representing 50 % of total banking assets.	Value	No	No	Yes
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment	Comprehensive information on number of problem institutions not available.	NRB approved the list of BFIs for diagnostics. Procurement of international firm to conduct diagnostics is in progress.	NRB program to initiate in-depth diagnostics approved with a list of BFIs selected representing 50 % of the banking assets.

Formulation of a financial sector development strategy	Value	No	No	No
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment	No comprehensive FSDS	A dedicated team has been created to draft road map. NRB has started consultations with stakeholders through workshops.	NRB and MoF to initiate technical consultation with with stakeholders for elaboration of FSDS and a road map has been developed

Draft Bill on Deposit & Credit Guarantee Trust (DCGT) endorsed by MoF	Value	No	No	Yes
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment	No legal and operational framework for deposit insurance	Legal framework ready with MoF endorsement of DCFT draft bill. Operational framework being finalized through assistance ofinternational advisor.	The legal and operational framework for deposit insurance is ready for implementation (pending legislative approval)

Amendment of NRB Act providing NRB with tools for effective bank resolution endorsed by MoF	Value	No	Yes	Yes
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment		The draft bill is with Ministry of Law & Justice and Parliamentary Affairs.

Promulgation of ordinances relating to Mutual Legal Assistance, Extradition and Organized Ccrime	Value	No	Yes	Yes
	Date	January 15, 2012	September 30, 2013	December 31, 2013
	Comment	Nepal threatened with dark grey classification (or worse) by FATF.	Nepal retains grey FATF classifcation.	Nepal retains grey or better FATF classification.

Consolidation of the financial sector through a decrease in number of financial institutions	Value	199.00	174.00	175.00
	Date	January 15, 2012	July 15, 2013	December 31, 2013
	Comment