Asian Life agrees to return paid-out dividends

KATHMANDU, Feb 2: Asian Life Insurance Company, which has been temporarily banned from doing business for flouting regulator´s orders, has agreed to return the dividends it had distributed among promoters and public shareholders by Sunday, according to Binod Aryal, a board member of the Insurance Board (IB). [break]



The company had expressed the commitment during a meeting held on Thursday between high ranking officials of the IB and Asian Life.

The IB on Sunday halted business transactions of Asian Life after the company violated the insurance sector regulator´s instruction on dividend distribution.



This has prevented the company from selling new policies. It will also have to take the Board´s permission before settling claims, although it is allowed to collect premium on policies sold in the past.



The latest IB investigation shows the company´s promoters had distributed Rs 45.2 million prior to issuing a public notice on dividend distribution. They had then distributed Rs 186,000 among public shareholders after the notice was published. The money was distributed despite the regulator´s moratorium on dividend distribution.



Currently, life insurance companies are not allowed to distribute dividends until they raise paid-up capital to Rs 500 million. Asian Life has a capital of only Rs 360 million. It has until Sunday to return the money.

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