Loan Defaulters Property Auction Nepal notice issued by Shangri-la Development bank

15th April 2026, Kathmandu

In a significant move to recover outstanding loans, Shangri-la Development Bank Limited has issued a public notice announcing the auction of mortgaged properties belonging to loan defaulters.

Loan Defaulters Property Auction

This step comes as part of the bank’s legal process to recover dues from borrowers who have failed to repay their loans within the agreed timeframe.

The notice invites interested individuals and institutions to participate in a sealed bid auction process for both movable and immovable assets pledged as collateral. This action, effective in Baisakh 2083, underscores the bank’s commitment to maintaining financial health and credit discipline.

Reason Behind the Auction

Loan defaults remain a major challenge in the banking sector of Nepal, directly affecting financial stability and liquidity. When borrowers fail to meet repayment obligations despite repeated notices and grace periods, banks are legally empowered to auction pledged assets to recoup losses.

In this specific case, Shangri-la Development Bank has proceeded with the auction after the concerned borrowers did not clear their outstanding principal, interest, penalties, and additional charges. This process follows the guidelines set by Nepal Rastra Bank to ensure a transparent recovery of public funds.

Auction Process and Timeline for Baisakh 2083

The bank has called for sealed bids from interested buyers, providing a 15-day notice period from the date of the official announcement.

Important Dates to Remember:

Notice Publication Date: Baisakh 2, 2083

Deadline for Bid Submission: Baisakh 16, 2083 (within office hours)

All bids must be submitted within this specific timeframe. It is important to note that late submissions or incomplete forms will not be considered under any circumstances.

How to Participate in the Auction

Interested bidders must follow a structured and formal process to ensure their participation is valid. The bank maintains a high standard of transparency during the evaluation of these bids.

Steps to Apply:

Obtain the Form: Visit any branch of Shangri-la Development Bank to get the official bid application form.

Security Deposit: Deposit the required bid security amount (usually a percentage of the bid price) into the bank’s designated account.

Draft the Bid: Clearly mention your bid amount in both figures and words to avoid any ambiguity.

Sealed Submission: Submit the completed form in a sealed envelope at the designated branch before the Baisakh 16 deadline.

The bids will eventually be opened in the presence of the bidders or their authorized representatives, ensuring a fair and competitive selection process.

Details of the Property in Nawalparasi

The current auction primarily includes land and related assets registered under the borrower’s name. The property is located in the Nawalparasi district and includes land plots with clearly defined measurements and ownership details as per the local land revenue records.

Additionally, the public notice includes information regarding the guarantors associated with the loan. This full disclosure ensures that all parties involved in the original transaction are aware of the legal proceedings and that potential buyers have a clear understanding of the asset’s history.

Terms and Conditions for Bidders

The bank has outlined several critical terms that participants must adhere to:

Selection: The highest bidder will generally be selected, provided they meet the bank’s minimum valuation criteria.

Payment Schedule: The winning bidder must pay the remaining balance within the timeframe specified by the bank.

Forfeiture: Failure to complete the full payment may result in the cancellation of the bid and the forfeiture of the security deposit.

Bank’s Discretion: The bank reserves the right to accept or reject any bid without providing a specific reason.

All legal procedures will be conducted in accordance with prevailing banking laws and the Recovery of Loans of Banks and Financial Institutions Act.

Impact on the Banking Sector and Investors

Property auctions due to loan defaults are becoming increasingly common in 2026 as banks tighten their recovery mechanisms. This trend reflects a broader push toward financial accountability in Nepal.

For investors, these auctions present a unique opportunity to acquire real estate or other assets at competitive market prices. However, due diligence is highly recommended to assess the actual property value, check for any legal encumbrances, and understand the associated risks before placing a bid.

Final Thoughts

The announcement by Shangri-la Development Bank highlights the critical importance of timely loan repayment and responsible financial behavior. While the auction serves as a recovery tool for the institution, it also opens doors for strategic investment.

Participants are encouraged to carefully review all terms, inspect the property in Nawalparasi if possible, and submit their bids before the Baisakh 16 deadline. As the financial system of Nepal continues to strengthen its regulatory framework, such actions reinforce the necessity of a disciplined credit culture.

For More: Loan Defaulters Property Auction