Citing different reasons, Nepal Stock Exchange (NEPSE) - the sole secondary share market - has suspended transactions in shares of nine different companies, that amount to a hung amount of investment.
NEPSE decided to suspend transactions in the shares of Maha Laxmi Finance, Birgunj Finance, Shiddhartha Finance, Butwal Finance and Himchuli Finance in May last year, charging them with going ahead with merger plans without taking consent from Nepal Rastra Bank (NRB) - the central bank.
Likewise, NEPSE also froze trading in the shares of Nepal Finance, Narayani Finance and Paschimanchal Finance on the charge of taking a collective decision to merge into a regional development bank without NRB´s approval.
Transactions in the shares of Siddhartha Bank have also been put on hold as the bank announced the issue of 1:5 rights shares to shareholders but later amended the decision and announced that the rights shares would be distributed phase-wise.
In the latest in a series of suspended transactions, NEPSE suspended transactions of the shares of Nepal SBI Bank last Tuesday, charging the bank with violating existing law by taking a decision to distribute bonus shares and rights shares through an annual general meeting without the approval of the bank’s board of directors.
"Investors are in confusion about the fate of their investments while the Securities Board and NEPSE are also losing revenue from share transactions due to lack of a clear provision in the law for settling such confusion," Shambhu Panta, spokesperson of NEPSE told myrepublica.com
Investors have demanded that the long-running confusion be settled at the earliest, with a specific timeframe for dealing with suspended shares. "Not only investors, the government also is losing revenue while brokers are losing commissions due to the suspension of transactions for an unspecified period for lack of clear-cut provisions for settling the matter," said Sagar Pandey, a share investor.
prabhakar@myrepublica.com
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