Kathmandu. The Securities Board of Nepal is preparing to curb the tendency of buying shares even if there is no money in the bank account of the share buyers.
The board for the current fiscal year 2082. In the annual policy and program for 83, it has been announced to curb the purchase and sale of borrowed shares to promote the interest of investors towards the securities market.
It has been written in the policy and program that while purchasing securities from the secondary market, the arrangement of transaction will be forwarded only after the amount is deposited in the bank account of the buyer.
Similarly, the Board is going to make arrangements for the primary issue of securities by verifying the application of the applicant through API from CDS and Clearing Limited immediately and the application amount will be frozen and the securities will be released after the allotment of securities.
Emphasizing on reducing systemic risk in the securities market, the Board is going to strictly implement such a provision to increase public confidence in the securities market by promoting the larger interest of the investors.
The board has already issued directives not to provide trading credit to buyers for trading shares without adequate security. The board has clarified this further in the policy and program.
The Board has also announced to monitor whether the money collected by issuing a public issue (IPO) has been mobilized as per the purpose of the issue.
Similarly, the Board will implement a risk-based supervision framework for effective supervision of licensed securities broker members.
