Out of Pressure from MoF, NEPSE Finally Decides to Recommend Letters for a New Broker License

It has been 26 days since the Securities Board of Nepal (SEBON) first accepted applications for new broker licenses. The board had requested an application with a 30-day deadline. Now, with only 4 working days remaining for the companies to submit applications, Nepal Stock Exchange (NEPSE) has finally chosen to issue a recommendation letter to the applying companies for the said license.

NEPSE was initially hesitating to issuing the letter of recommendation. On the other hand, SEBON had previously stated that NEPSE's recommendation is mandatory. Without NEPSE's recommendation, the application is incomplete. SEBON could not accept an incomplete application, and if the petition had been approved without NEPSE's recommendation, the Securities Board's process would have come under scrutiny. Hence, the Ministry of Finance on Wednesday mandated NEPSE to give recommendations to the companies applying for the broker licenses.

The difficulty faced by the companies seeking to obtain the license of a new broker firm is now resolved as a result of the NEPSE board of directors' decision to make a recommendation. Each applicant will receive a recommendation from NEPSE. Likewise, 21 applications have reportedly been submitted for NEPSE recommendations.