Kathmandu, October 22:

In a bid to effectively operate stock market and modernise it, the management of Nepal Stock Exchange Ltd, headed by Rewat Bahadur Karki is all set to say goodbye to one-third of its employees within a few days under a voluntary retirement scheme (VRS).

The decision to introduce VRS was taken recently by the Board of Nepal Stock Exchange Ltd. Along with it, automation of the stock market is also going to start from November 2006, according to top officials of Nepal Stock Exchange. Karki, as soon as he was appointed as the GM of Nepal Stock Exchange Ltd about three months ago, had promised strong and effective reforms in the stock market in the form of VRS, automation and privatisation.

46 employees currently are employed at the Nepal Stock Exchange Ltd. One-third is likely to leave their jobs on a ‘golden handshake’. The minimum amount of money on offer under the VRS scheme to the lowest level staff is expected to be no less than Rs 600,000. The highest compensation may be more than double of this amount, according to stock market officials.

VRS is applicable to employees of the stock market who have completed ten years in service.

Asked to Karki as to why the management is adopting VRS, he replied: “It is the best way to make the stock exchange limited more professional and make it more competitive in days to come to modernize stock market. He informed that they are ultimately pushing the stock market into privatisation process after various reforms.

The employees who are likely to fall under the VRS scheme range from security guards, sweepers to higher level staff. The stock exchange is facing quality labour force. It is expected that after the successful launching of VRS, some fresh, qualified professionals would be hired on a contract basis, said Karki.

Outsourcing is the most crucial element that Stock Exchange Ltd is looking for currently, according to him. Some employees have already started submitting their applications for VRS, said Karki.

Being the first of its kind, the stock market VRS is expected to get a sound response, Karki said. He hoped that after the effective reform process, stock market transactions would see a robust growth, as the market will attract big institutional investors as well.

The stock exchange is likely to spend Rs 10 million on the VRS. After VRS, Karki hoped to bring down the operating cost of the organisation significantly, but he did not disclose on how much overhead expenses would be cut.

Some important Nepali organisations such as Nepal Bank Ltd, Rastriya Banijya Bank, Agriculture Development Bank, Nepal Industrial Development Corporation (NIDC) and the Nepal Airlines Corporation (NAC) have already launched VRSs to make themselves professionally competitive.