SEBON Revises Underwriting Limits for Merchant Banks Owned by Banks and Insurance Companies

The Securities Board of Nepal (SEBON) has revised the underwriting capacity of merchant banks operating as subsidiaries of banks and insurance companies. The regulatory body has decided to amend the Merchant Banker Regulations, increasing the maximum underwriting limit for such entities.

According to SEBON spokesperson Niranjaya Ghimire, merchant banks owned by banks and insurance companies will now be allowed to underwrite securities up to the net worth of their respective institutions, provided that the banks and insurance companies guarantee liability coverage.

Previously, these merchant banks were permitted to underwrite securities up to three times their net worth. However, this provision had not yet been incorporated into the Merchant Banker Regulations' schedule. SEBON has stated that the necessary amendments will be formally integrated soon.