Nepal | September 29, 2020

Share investors stage protest at Nepse, submit 10-point demand

Himalayan News Service
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Kathmandu, December 9

Due to the continuous decline in the share market in the past few months, share investors have sought the resignation of Finance Minister Yubaraj Khatiwada and have submitted a 10-point demand to the government today.

The investors today held a sit-in on the premises of Nepal Stock Exchange (Nepse) — the country’s sole secondary market — and have said that they will continue with their protests until the government meets their demands. They stated that they were compelled to resort to a sit-in protest as the government has not done anything substantial to boost the market.

Moreover, investors have said that they have taken this step to create a secure environment so as to protect the interest of the investors in the securities market who have reportedly lost billions of rupees in the last few months.

Various investor organisations like Nepal Investors’ Forum and Investors Association of Nepal, among others have voiced their support for the protest.

“It looks like the government is discouraging investors from investing in the secondary market,” said Uttam Aryal, chairman of Investors Association of Nepal, adding that they have strongly suggested the government to fulfil their demands as soon as possible for the security of their investments.

Meanwhile, the investors have urged the government to introduce clear guidelines regarding the securities market and have sought special programmes for the expansion of the market. Likewise, they have stated that awareness programmes regarding the online trading system should be organised so that small investors can also benefit from it.

Moreover, they have also mentioned that the Securities Board of Nepal (SEBON) should introduce provisions whereby non-resident Nepalis and other Nepali citizens living abroad can participate in the domestic securities market. They have also urged the government to implement margin trading through brokers.

Similarly, investors have demanded for commercial banks to be provided with broker’s licence and to also provide licence to new brokers across the country so that the securities market is accessible to all the people.

Among other demands, they have also said that margin loan should be at 80 per cent of the value of the shares and the risk weighted average should be set at 100 per cent or less to make loans cheaply accessible. Banks and financial institutions (BFIs) should be allowed to float 25 per cent of the total loan capacity for margin type loan and not 25 per cent of the core capital, they mentioned.

Investors have also urged SEBON to immediately establish market makers and dealership which has been in the pipeline since the past three years. They have also stated that companies that have received credit rating of grade four or five should not be allowed to issue initial public offerings, among other demands.

Meanwhile, despite the increment in interest rate on deposits of BFIs, the Nepse index today increased by 0.97 per cent or 10.85 points to land at 1,131.70 points.

A version of this article appears in print on December 10, 2018 of The Himalayan Times.

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