October 18: Nepal Stock Exchange (NEPSE) has issued recommendations for broker license to 45 companies as of October 17. There is a provision that any company seeking broker’s license from the Securities Board of Nepal (SEBON) must first get recommendation from NEPSE.

As of October 16, a total of 20 companies have submitted applications with the board seeking brokers’ license. The board has not updated any details after that. The last date for submitting application for the license was October 17.

According to Murahari Parajuli, information officer of NEPSE, most of the 45 companies that received recommendations are eligible for first-level broker services based on the capital structure set by the board.

The capital requirement for new broker license has been fixed between Rs 200 million to Rs 1.5 billion. Brokers will be issued three different types of licenses based on their capital structure.

As per the new provision, the first kind of brokers providing limited services of stock market transaction require a minimum capital of Rs 200 million to acquire license. Likewise, the brokers providing services like share transaction, depository participant, investment consultancy, investment management and margin business need to have a minimum paid up capital of Rs 600 million.

Similarly, the third type of license will be issued for stock dealers who must maintain a minimum capital of Rs 1.5 billion.

According to Parajuli, three companies have received recommendations for the second-level broker license with full scope and only one company for the third-level stock dealer.

Parajuli informed that Nabil Securities, a subsidiary company of Nabil Bank, has received recommendation from NEPSE for the third-level stock dealer license.

Likewise, Parajuli said Mega Stock Market, Century Securities and Himalayan Securities have received recommendations for the second-level license with full scope.

The board had called for applications for to operate a new stock exchange company and two commodity exchanges along with broker's license on the September 18. The deadline to submit application for broker license was 30 days while the deadline for stock exchanges and commodity exchanges was of 45 days.