Securities market regulator to classify brokers by next fiscal
Kathmandu, July 9
To improve the standings of brokerage companies, the Securities Board of Nepal (SEBON) has announced that it will classify brokers by next fiscal year.
Unveiling the ‘Policy and Programme of the Securities and Commodities Exchange Market’, SEBON Chairman RewatBahadurKarki, said that the capital market authority will classify the level of brokers as per their performance, capital base, professionalism, compliance to rules and regulations, and competitive services, among others.
According to Karki, SEBON has planned to classify the stockbrokers into ‘A’, ‘B’ and ‘C’ grade by next fiscal.
SEBON has also announced that it will launch the ‘One Nepali One Demat Account’ campaign to bring massive participation of the public in the securities market.
According to Karki, the ‘Policy and Programme’ has introduced stricter market supervision. It has also mentioned about conducting a study to initiate Municipal Bond. SEBON also plans to conduct a study on book building system to introduce a free pricing system in the stock market. The ‘Policy and Programme’ also speaks about strengthening the
regulations and enhancing the capacity of the regulatory body. Other plans include developing and reforming the securities market infrastructure.
“SEBON will work closely with the Ministry of Finance and Office of Company Registrar to bring real sector companies into the stock market,” stated Karki.
Earlier in the budget, the government had announced that all manufacturing companies that have been established with capital of Rs one billion or above will be mandatorily converted into a public company and be listed in the secondary market.
The ‘Policy and Programme’ has also announced the opening of provincial offices excluding in Province 3 to enhance the investment capabilities of the general public or investors.
The securities market regulator also plans to introduce a strict mechanism to check money laundering activities by listed companies, insider trading, and mergers and acquisitions of listed companies and securities firms. It will also enhance its regulation of the commodities exchange market.
As per Karki, SEBON has plans to formulate a new act related to the securities market, which will be introduced by upcoming fiscal. He also informed that SEBON will soon issue licence to the private sector to open a new stock exchange company so as to bring international level trading system in the country. The process of licensing will probably be initiated in the next fiscal year.