Nepal: Request for an Extension of the Extended Credit Facility Arrangement-Press Release; and Staff Report

This paper presents Nepal’s Request for an Extension of the Extended Credit Facility (ECF) Arrangement. The proposed program extension aims to provide additional time for completing the seventh and final review under the ECF arrangement. This extension is necessary to finalize a key structural reform involving the submission of amendments to the Nepal Rastra Bank (NRB) Act to Parliament. Progress on this reform was delayed partly because of the March 2026 elections and the subsequent administrative transition. The proposed amendments are expected to strengthen the governance framework of the NRB and improve the bank resolution mechanism, aligning with the broader objectives of the ECF-supported program. These reforms are intended to enhance financial sector stability and institutional effectiveness. The government has reaffirmed its commitment to maintaining stable macroeconomic policies and ensuring the successful implementation of the program’s objectives and reform agenda in the coming period.