Banking Exam Question - What are the NRB Directives (2074) Regarding Loan Against to the Margin Lending Nature of Shares of Licensed Institutions? Explain

Introduction - Provision of Loan Against Margin Lending Nature of Shares of Licensed Institutions

(A) Margin Lending, which will flow from the bank and financial institutions in the risk of shares of the recognized entities in the mortgage exchange market, will be provided only according to the terms and conditions of nature related to the nature of the loan.

1. When the rate of flow of flow is due, the shares of the last tenure of the previous 180 work days, which are lower than the prevailing market value of the shares or shares, which are less than 50 percent of the amount can be shared only. Is it Once the flow of such flow has been rehabilitated, the loan will not be made to maintain additional debt limit on the basis of basis or to provide additional debt.

(B) Margin Call Registry:

1. Due to the change in the market value of the shares, the Margin Call will be required to inform the debtor to inform the debtor and bring the direct bank within the direct limits within the next 7 days after the related bank and financial institutions will be required. However, Margin Call will not be compelled to reduce the value of the stock placed in the security rate by 10 percent. In addition, if the shares kept in the safeguards, the maximum amount of debt dues is more than one and a half times, such a Margin Call will not be required. 
2. After issuing the notice in accordance with section (a), the concerned banks and financial institutions will be able to deposit the Margin cash deposit from the debtor / customer concerned within 35 days due to the date of Margin Call. 
3. In the meantime in the last 7 days, if the deposit (b) is not in accordance with the provisions of the SAARC, the shares will be sold through the exchange market and loan to the bank. 
4. No such loan will be made for a loan per cent for a loan which is not in accordance with section (c).