The letter, which was issued on Thursday, has asked the non-life insurance company to submit the clarification within next three days, said a high-ranking official of the Board on condition of anonymity.[break]
"The news reports have drawn our attention and we want to know the truth,” the source said, adding, it is illegal for a public company to halt its normal business operation without taking consent of all its shareholders.
Everest Insurance stopped issuing new insurance policies from Tuesday and warned to close down the company in the future to protest issuance of corporate governance directive by the Insurance Board.
The directive, among others, bars insurance companies from generating business from its promoters, prevents one person from assuming the position of board director in multiple insurance companies and restricts more than one member of a family from assuming post of board director in the same company.
Nepal Stock Exchange also suspended share trading of the insurer on Wednesday, after news reports said it had partially halted business transaction and was planning to shut down the company in the coming days.
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