HIMALAYAN NEWS SERVICE
KATHMANDU: Share trading of public sector insurance company — Rastriya Beema Sansthan (RBS) — has resumed at the stock exchange following a hiatus of 15 months.
Along with the resumption in share trading, the state owned insurer has signalled 93 per cent dividend to shareholders as promised a year ago.
The stock trading of RBS was suspended after the regulator took action against the company for announcing dividends without getting its approval in September 2012.
There are almost one million unit shares of the insurance firm listed at Nepal Stock Exchange (Nepse), with a market capitalisation worth Rs 2.03 billion. Its share
price stood at Rs 2061 as of September 29, 2012, closing.
In September 2012, RBS had announced its plan to distribute 39 per cent bonus shares for fiscal years 2003-04 and 2004-05, and 15 per cent for fiscal year 2005-06. In addition, it had called for the annual general meeting to be held in October 2012.
However, the regulator — Insurance Board — struck down the decision for calling it against regulation. According to IB regulations, an insurance company can only call an AGM after getting its balance sheet endorsed by the regulator.
The press statement issued by RBS for its trading resumption also mentions that the book closure date for the dividend distribution and AGM will be announced later. The regulator has not approved the insurer’s audited balance sheets of those years. However, RBS has already distributed Rs 27.25 million as bonus from its profit for those years to employees. The Commission for the Investigation of Abuse of Authority is also looking into the case now.
RBS that is required to split its life and non-life business is working on getting it done before the end of the current fiscal year. IB has also not renewed its operating licence for its inability to split its businesses according to law.