Decision to issue broker license to banks; final approval by Parliamentary Committee after year-long bewilderment

Tue, Jul 7, 2020 4:33 PM on Latest, NEPSE News,
Decision t...

The parliamentary sub-committee has recommended that banks be given a broker license after intensive research. Favoring broker companies, the parliamentary committee had withheld broker licenses to banks a year ago.

A high-level committee formed by the government had recommended issuing broker license to banks. After that, the NRB and the Securities and Exchange Board of Nepal (SEBON) had started the necessary process.

However, the parliamentary committee had then prevented the government from issuing licenses to banks. The parliament had also formed a sub-committee to study on the matter. This sub-committee then discussed the issue with several stakeholders. Furthermore, the committee also visited three countries to better understand the practice outside Nepal.

A sub-committee was formed under the leadership of CPN (Maoist) MP Ram Kumari Jhankri last Shrawan. The sub-committed was instructed to submit a report within two months. However, almost a year later, the sub-committee has now submitted its report recommending to issue broker licenses to banks.

The report given by the sub-committee will be studied by the parliamentary committee. If the committee decides in accordance with the report, the way will be clear for banks to get a broker license.

However, licenses will not be directly available to commercial banks. A subsidiary company will have to be made. A few banks had already opened subsidiaries a year ago when the decision to issue licenses was proposed. In fact, they had also started recruiting staff.