Kathmandu, February 4 - With an aim to expand the secondary market and make it more attractive and investment-friendly, the stateowned Employees Provident Fund (EPF) has said it will establish a stock dealer company.
The EPF has stated that the subsidiary company will act as a principal in stock trading through its own account, as opposed to a broker that acts like an agent who executes orders on behalf of its clients. Tulasi Prasad Gautam, administrator of EPF, said they have already started the process to establish the company.
“We have already proposed to the Ministry of Finance to amend the existing EPF Act and include necessary provisions to establish a stock dealer company.” “As per talks with the ministry, it will soon amend the EPF Act and table it at the Cabinet for approval,” he said, adding, “As per our understanding with the concerned stakeholders and the ministry, the act will be amended in this Parliament’s winter season.”
According to Gautam, EPF will establish the company with other stakeholders, including banks and insurance companies, as shareholders, where EPF will hold the majority stake in the company. He further claimed that the company will be the largest-ever stock dealer company in Nepal and will be able to hold shares worth billions of rupees of different companies.
For the same purpose, Citizen Investment Trust (CIT) has also established a subsidiary company as a stock dealer to enhance investment in the market.
A few days ago, Finance Minister Yubaraj Khatiwada had informed that the government will soon issue CIT a licence to act as a stock dealer and ‘market maker’. Addressing the meeting of Finance Committee of the Parliament, he had said that necessary groundwork is being done to allow CIT to start a subsidiary market dealer firm and raise investment in the country’s sole capital market.
Source: The Himalayan Times