September 17: Chairman of the Securities Board of Nepal (SEBON) Ramesh Kumar Hamal has said that SEBON is preparing to review the brokers’ commission. He also said that the broker commission will be reviewed in such a way that the securities broker companies will not suffer. Speaking at an interaction program on Capital Market: Possibilities and Challenges held in Kathmandu on Friday, Chairman Hamal said that broker companies are the heart of the capital market and that the commission will be reviewed in a way that they will not suffer. He also mentioned that the board's commission will be reduced before the broker's commission is reduced.

Hamal said that SEBON is going to review the brokers’ commission keeping in mind the interests of the common investors. Hamal informed that he has discussed the matter of reducing broker commission in depth with the broker companies and expressed his commitment that the commission will be reviewed so that no one in the market is be at a loss.

Hamal opposed the 10-share policy in the initial public offering (IPO). Hamal also pointed out the need to strengthen the positive aspects of this policy and to review the negative aspects.

He has accepted that the capital market has reached many investors due to the 10 per cent policy. Hamal said that in the future, the board will give priority to raising institutional investors in the securities market.

Hamal also informed that the study committee formed by the board on the issue of allowing non-resident Nepalis to enter the securities market has already prepared the necessary report and the necessary law-making work is underway. Informing that the board is preparing to implement a new system for the right shares, Hamal said that the qualifications of independent directors of listed companies will also be determined.

In response to the question of whether the board can take action against the companies whose share prices in the secondary market have dropped below the premium price, Mukti Shrestha, the executive chairman of the board, said that although the board will approve good companies to issue IPOs at a premium price, the board will not force investors to buy shares of those companies. Shrestha believes that the investors themselves should take responsibility for the risk in the secondary market from the decision to purchase the IPO.

While the board is saying that it is studying the matter of reducing the broker commission, the representatives of the broker companies have requested not to reduce it. Chairman of Stock Brokers Association Dharmaraj Sapkota and Secretary General of Securities Stock Brokers Association Krishna Giri said that the brokers are running at a loss in the current situation and requested not to review the commission.

General Secretary Giri suggested that when new broker companies have just entered the securities market, they should be evaluated for a few years first.

President Sapkota said that in the case of old broker companies, there are some technical difficulties in providing margin loans and the board should solve those difficulties.