Mon, Jan 7, 2019 1:20 PM
Chhimek Laghubitta Bittiya Sanstha Limited (CBBL)'s 212st BOD meeting had proposed 40% dividend including 18% bonus shares and 22% cash dividend for the FY 2074/75. The dividend was supposed to be distributed after approval from Nepal Rastra Bank and upcoming AGM of the company. However, Rastra Bank has disapproved its proposition for dividend distribution.
Upon enquiry, the officials at CBBL clarified that the dividend isn't being removed rather just postponed. The microfinance company had been established under a parent company named Chhimek Samaj Sewa Sanstha. The microfinance company had been maintaining a Client Protection Fund for its members under Chhimek Samaj Sewa Sanstha, which was utilized as subsidies and help at time of need and as prize for good occasions. It has also been used to buy land for helping the members to train and practice modern farming. The official says, "The land was bought at Rs 40 lakh per kattha, and now it's worth twice as much".
The official adds, "However, the activities weren't done outside the law. The NRB had conducted field audit at numerous occasions and since they've found that no embezzlement has happened and all the funds has been used wisely, they had let us operate in the same manner." But the recent directive has mandated us to transfer the funds in the Chhimek Samaj Sewa Kosh to the bank itself for better transparency. We were aware of it and had already initiated the process."
"When we proposed the dividend, the transfer was in final phase with only certain promoter shares remaining. Despite that we felt that we should inform NEPSE and our shareholders regarding what has happened. So the shareholders don't need to worry. NRB has asked us to complete the fund transfer and apply again." concluded the official.