Nepal’s capital and stock markets have been pushed into a difficult position due to the recent suspension of public issuances worth around Rs 80 billion. The halt has resulted from protests staged by SEBON employees. As a result, about 100 companies are left waiting for approvals of IPOs, rights shares, debentures, and mutual funds—applications totalling over 1.37 billion units. Since early September, when the NMB Saral Bachat Fund-E was the last scheme to receive approval, the market has remained at a complete standstill. These prolonged delays have made investors uneasy and created challenges for companies seeking fresh capital. The suspension has slowed down overall market activity and restricted liquidity movement. It has also discouraged potential new entrants to the market, while overall confidence in Nepal’s capital market continues to decline. At the heart of this crisis lies a conflict between SEBON staff and the Ministry of Finance. The finance ministry has instructed employees to return perks and loans they received from welfare funds, citing violations of government and SEBON regulations. This demand triggered the strike that began in late September, with SEBON employees calling for regulatory independence and the resignation of SEBON chairman.
The protest has not only blocked approvals but also prevented the chairman from assuming office, making it nearly impossible to manage operations smoothly. Although discussions are ongoing at the Ministry of Finance to resolve the deadlock, including exploring legal avenues, a lasting solution still seems distant. This prolonged disruption exposes deep structural cracks in Nepal’s stock market system. Public offerings are essential for companies to raise funds and when these are delayed, economic growth is stifled and investment opportunities shrink. It also raises concerns about the effectiveness of regulatory enforcement, making both domestic and foreign investors more cautious. In a market already plagued by insider trading, irregular disclosures, and opaque practices, this standstill only heightens uncertainty. Nepal’s stock market has long suffered from weak oversight and inconsistent governance. Without strong regulation and transparent processes, market participants lose faith and growth falters. For the first time since SEBON’s establishment, this standoff highlights the consequences of internal dysfunction within the regulatory body—and underscores the urgent need for good governance, timely approvals, and strict action against malpractice.
The SEBON staff protest is more than an internal dispute—it affects capital formation, investor confidence, and market credibility. If left unresolved, companies may seek alternative funding outside regulated markets, undermining the formal financial system. To restore trust, the government and SEBON must urgently resolve their differences and ensure the regulator functions effectively and independently. They must also tackle long-neglected issues such as insider trading and irregularities. Only through swift and transparent action can investor confidence be revived. The prolonged inaction has not only eroded market sentiment but also served as a warning for Nepal’s broader economy. Authorities must address these shortcomings immediately before they snowball into a deeper financial crisis.