LIC Nepal has been asked by two regulators for an Explanation
Kathmandu: Nepal Insurance Authority and Nepal Securities Board of Nepal (SEBON) have asked for an explanation about the delay in the issue of LIC Nepal’s rightful shares. According to the sources of the Securities Board of Nepal, the study will be started in the whole process with regard to insider trading.
Nepal Insurance Authority had given permission for 88.45168 percent rights shares due to the obligation to give right shares. The Nepal Insurance Authority had allowed the issuance of 88.45168 percent rights to a company that is not solely owned by Nepal. But LIC Nepal has investment from Life Insurance Corporation of India of 55%, Bishal Group of 25% and general public of 20%.
According to the board, a petition has also been submitted to the Securities Board of Nepal for manipulation of the market in the name of right shares for paid-up capital increase. The board is going to start a study on the manipulation of the secondary market by giving a notice that it is preparing to issue rights shares for 6 months.
LIC Nepal received permission to issue 88.45168 percent of its paid-up capital from the Nepal Insurance Authority on 30th of June 2023 A.D.The company had applied to the board for the issue of rights shares on 16th of September. Even after 6 months, since the shares of the company have not been issued, the investigation of insider trading will be started under suspicion according to the SEBON.
After the Nepal Insurance Authority extended the time in the process of issue of rights shares, LIC Nepal has cut the letter and taken the clarification.
In response to the question asked by the Insurance Authority, the company replied that the time was extended due to the process of the Securities Board of Nepal. LIC Nepal should consult LIC India before taking any decision. The company says that due to this reason also the delay has occurred.
The board has also cut the letter saying that there is a stock manipulation in the secondary market after showing the hope of rights for 6 months.
Currently, the company’s paid-up capital is 2 billion 653 million 200 thousand Rupees. The company is about to issue rights shares worth 2 billion 346 million 800 thousand Rupees, which is 88.45168 percent of the paid-up capital.