The newly appointed Chairman of Securities Board of Nepal, Dr. Gopal Prasad Bhatta, has shared his main plans and fifteen key agendas for the development and expansion of the capital market.
The newly appointed Chairman of the Securities Board of Nepal (SEBON), Dr. Gopal Prasad Bhatta, has said that his first priority is the development, diversification, and restoring investor trust in the capital market. In an exclusive interview with Bajar ko Chirfar, he shared that SEBON is preparing a detailed blueprint and action plan to implementing from the new fiscal year.
SEBON’s Three Roles and New Instruments
Dr. Bhatta explained that many people thinks that SEBON is only a rule-making body. However, he clarified that SEBON actually has three major roles. These roles are creating new institutions, new financial instruments, and new markets, running those structures in a systematic way, and taking action if someone breaks the rules.
He admitted that the capital market of Nepal is currently very limited. In the coming days, SEBON plans to expand the market beyond just equity. The new plan will introduce corporate bonds, government bonds, municipal bonds, derivatives, Exchange Traded Funds (ETFs), private equity, venture capital, and SME platform. It will also bring investment opportunities for foreign investors and Non-Resident Nepalis (NRN).
Discussion with Stakeholders and AML/CFT Concerns
Currently, SEBON is discussing with NEPSE, CDSC, brokers, merchant bankers, credit rating agencies, and investors to prepare this blueprint. Dr. Bhatta said they will release the action plan publicly just like Nepal Rastra Bank releases the monetary policy.
He also talked about the recent actions regarding Anti-Money Laundering (AML/CFT). He clarified that this is just a regular annual activity. Since Nepal is currently on the international grey list, it is SEBON’s regular duty to build the capacity of market institutions. He told that normal investors does not need to fear because only those using illegal money will face action.
Index Reforms and Margin Lending
The chairman accepted that the current NEPSE index needs some improvements. SEBON is planning to refine the float index and develop a new index system based on international practices that shows the real condition of the market. They are also studying the supply imbalance that happens when the lock-in period of IPO, FPO, and promoter shares open.
To expand margin lending through brokers, SEBON is holding talks with the central bank, commercial banks, and brokers. They want to build a system where brokers can manage funds from banks by keeping investors’ shares as collateral.
Technology and Future Plans
SEBON is preparing to implement the reforms mentioned in the government budget. This includes starting short selling, intraday trading, expanding margin trading, and launching the commodity market.
Technology will be a huge focus for SEBON. They are planning to invest in online systems, digitizing the auction process, and modernizing the regulatory technology. Dr. Bhatta added that the current government is very positive about the share market, so investors should stay patient because such opportunities do not come often.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
