The Nepal Rastra Bank (NRB) has announced that promoters holding more than 25% of paid-up capital in microfinance institutions will no longer be eligible for dividends unless they reduce their holdings to the prescribed limit.
The Nepal Rastra Bank (NRB) has issued a new regulation stating that promoters of microfinance institutions who hold more than 25% of the paid-up capital will not be entitled to receive dividends. To become eligible, these promoters must reduce their shareholding to 25% or below.
This provision has been introduced through the “Procedure for Approval of Financial Statements and Dividend Distribution for Annual General Meeting of Banks and Financial Institutions, 2082”, published by NRB on Wednesday. The procedure specifies that in the case of Class G financial institutions, promoters holding shares beyond the prescribed limit will have their proposed cash dividends and bonus share distributions withheld until they comply with the 25% cap.
This new procedure replaces the earlier regulation issued in 2077, introducing stricter compliance requirements for promoter shareholding and dividend eligibility in microfinance institutions.
This article was originally published on https://bajarkochirfar.com. Translated with the help of AI and reviewed by our editorial team.
