3rd September 2025, Kathmandu
RBB Merchant Banking Limited has officially commenced the sale of its new mutual fund scheme, ‘RBB Focus-40,’ a closed-end fund designed to provide a structured, long-term investment opportunity for Nepali investors.
RBB Focus-40 Launched
The fund, which falls under the RBB Mutual Fund umbrella, is offering a total of 100 million units at a face value of NPR 10 per unit, aiming to raise a total of NPR 1 billion. This initiative is a significant step in expanding Nepal’s mutual fund ecosystem and encouraging broader public participation in the capital market.
Key Scheme and Application Details
The fund’s structure is designed to allocate units across various investor types. The majority of the units are available for the public, while a portion is reserved for the key institutions behind the fund. Specifically:
- Promoter Quota: Rastriya Banijya Bank, the fund’s promoter, has been allocated a minimum of 14% of the issued units, which amounts to at least 14 million units.
- Fund Manager Quota: RBB Merchant Banking, which manages the fund, has reserved a minimum of 1% of the issued units, or at least 1 million units.
- Public Quota: The remaining 85 million units are available for general retail and institutional investors.
This distribution model ensures that the fund is well-supported by its founding institutions while still providing ample opportunity for the general public to participate. The application window for investors opened on Wednesday, Bhadra 18, 2082 (September 3, 2025). The earliest closing date for the issue is Bhadra 22, 2082 (September 7, 2025), but the sale can be extended until Ashoj 1, 2082 (September 17, 2025) if the fund is not fully subscribed by the initial deadline.
Investment Horizon and Accessibility
‘RBB Focus-40’ is a closed-end mutual fund with a tenure of 12 years. Unlike open-ended funds, which can be redeemed directly with the fund manager, units of a closed-end fund are listed and traded on the stock exchange after the IPO. This means that once the fund’s units are listed on the Nepal Stock Exchange (NEPSE), investors can buy and sell them in the secondary market, providing liquidity before the fund’s 12-year maturity period is up.
The fund is designed to be highly accessible, with a minimum application size of just 100 units (NPR 1,000). This low entry barrier makes it a viable investment option for small-scale retail investors. The application process is also convenient, allowing investors to subscribe for units through C-ASBA-registered banks and financial institutions, as well as via the Mero Share portal of CDS & Clearing Limited (CDSC), ensuring nationwide reach.
Confidence-Boosting Ratings
To provide assurance to prospective investors, the scheme has been professionally rated by two leading credit rating agencies in Nepal. Care Ratings Nepal has assigned the promoter, Rastriya Banijya Bank, a CARE NP A+ Issuer Rating, which signifies a strong capacity to meet financial obligations. Separately, ICRA Nepal has given the fund manager, RBB Merchant Banking, an ICRANP AMC Quality 3 Rating, which indicates an adequate investment management quality. These ratings offer external validation of the fund’s stability and the expertise of its management.
Broader Impact on the Capital Market
The launch of RBB Focus-40 is more than just another IPO; it represents a deepening of Nepal’s capital market. As a mutual fund, it offers several benefits that direct stock trading does not:
- Diversification: The fund will invest in a diversified portfolio of securities, including at least 40 fundamentally strong companies, which helps spread and reduce risk for individual investors.
- Professional Management: Investors can rely on the professional expertise of RBB Merchant Banking to make informed investment decisions, which is particularly beneficial for those who lack the time or knowledge to manage their own portfolios.
- Encouraging Savings: Mutual funds serve as an efficient mechanism for mobilizing savings from the public and channeling them into productive sectors of the economy.
The mutual fund sector plays a crucial role in a maturing capital market by increasing institutional participation and providing a safer, more regulated alternative for retail investors. The introduction of ‘RBB Focus-40’ will help expand the choices available to investors and further strengthen the mutual fund ecosystem in Nepal.
In conclusion, the launch of the ‘RBB Focus-40’ scheme marks a significant milestone for RBB Merchant Banking and Nepal’s financial market as a whole. Backed by the institutional strength of Rastriya Banijya Bank and managed with a commitment to professional excellence, the fund offers a structured, long-term investment vehicle for a wide range of investors. As the issue is now open, it provides an excellent opportunity for both seasoned and new investors to participate in a professionally managed, diversified investment instrument designed for long-term growth.
For More: RBB Focus-40 Launched