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General Information About Stakeholders Of Stock Market in Nepal
Securities Board of Nepal (SEBON) is government owned body started on 7th June. It is a regulatory organization for securities market in Nepal. Head of the organization i.e. Chairman is elected by the Government for 4 years. The board has 7 members including Chairman and Joint Secretary from the 2 ministries, Finance Ministry and Law and justice Ministry. Other members in this organizations are representative from NRB, Institute of Charted Accountant of Nepal, expert from Planning Department. The organization runs under the Act, known as Security Act 2006.SEBON is responsible for overall monitoring and evaluation of listed companies in the country. Any public company to be listed in stock market, it has to pass different stages inspected by SEBON.
Nepal Stock Exchange (NEPSE) is the one and only stock market in the country. It was established under the Companies Act- 2006. NEPSE operates under Securities Act- 2007. The basic objective of NEPSE is to impart free marketability and liquidity to the government and corporate securities by facilitating transactions in its trading floor through member, market intermediaries, such as broker, market makers etc. NEPSE started trading floor on13th January 1994. As of 2022. It faces many stages from traditional trading era to current NEPSE digital Trading Management System (TMS). At the times, it took 2 months to transfer share from seller to buyer and now it takes just 2 days to complete the cycle of trading. The paid-up capital of NEPSE is NRs.50,00,00,000. Its shareholders are Government of Nepal, Nepal Rastra Bank, Employees Provident Fund, Rastriya Banijya Bank, Laxmi Bank Ltd, Prabhu Bank Ltd and other securities businessperson.
Nepal Rastra Bank (NRB) is the Central Bank of Nepal. NRB was established in 1956 under the Act Nepal Rastra Bank 1955. The main purpose was to discharge the central banking responsibilities including guiding the development of the embryonic domestic financial sector. It has proved that its establishment was the milestone for the significant growth in both the number and the activities of the domestic financial institutions in the country. It has faced different disasters such as 2008 economic crisis, blockade by India, major earth quakes and plays the parental role for the dynamic position in the financial and planning sustainable programs and policy in country. It releases monitory policies in every fiscal year and reviews it in quarterly basis.
As of writing there are 25 mutual funds trading in NEPSE. A mutual fund is a financial institution that collects money from many small to institutional investors for the further investment in different public products such as primary or secondary market stocks, bonds. Currently most of the mutual funds are operated by subsidiaries of different Bank and financial institution of the country. These mutual funds acts under the Mutual Fund Directives, 2067 by the SEBON. They are considered to be Market maker in the secondary market of security investment. They are given different facilities by SEBON and NRB so as to fulfill the objective of mutual funds.
Nepal Investors Forum is the group of small as well as big market maker investors of Stock Market in Nepal. It is a non-profit organization registered under law of 2034. It has run many movement in last decade for the growth and stability of Secondary market in the country. After Nepal Investors Forum many organization of its type are established. But none of them play their role as effective as Nepal Investors Forum.
These are the companies that are registered as pubic limited companies and listed in NEPSE, the one and only stock market in the country. For a public company to be listed in NEPSE it should follow and passed all the mandatories as directed by SEBON. Some of them are number of shareholders, minimum paid up capital, establishment time of company, its last 3 years audit reports. Currently major listed companies are banking and financial institutions, life and non-life insurance companies, hydropower companies, production sectors and investment companies.