SEBON asks Century Bank not to issue IPO as of now

Mon, Sep 9, 2013 12:00 AM on IPO/FPO News,

ShareSansar, Sept 9:

The Securities Board of Nepal (SEBON) has reportedly stopped Century Commercial Bank Limited from issuing IPO shares as the commercial bank was about to float its primary shares without meeting the criteria set by the Nepal Rastra Bank and other regulatory agencies.

The SEBON has even directed Century Commercial Bank to file application at the Board to issue the IPO shares only after it meets all the criteria.

SEBON spokesperson Niraj Giri informed that the bank will not be able to issue its primary shares as it is yet to complete certain procedures for the same.  

“We have noticed that the bank has not completed some of the crucial criteria,” Giri said. “The Board has issued a strong directive to the bank to complete all the necessary procedures before issuing the primary shares.”

According to sources, Century Commercial Bank is yet to complete its credit rating as per the Credit Rating Regulation 2011.

There is also a discrepancy regarding the date of operation of the bank on the documents it has issued in connection with the issuance of the IPO shares.

The bank had also tried to issue the IPO shares by using only its logo -- without mentioning its name on its prospectus, according to sources.

The bank’s Chief Executive Officer Ganesh Kumar Shrestha, however, said that they were trying to rectify a few “technical problems” before the IPO shares are floated.

Back in May, Century Commercial Bank had informed that it is all set to issue IPO shares within this fiscal year.

The bank was planning to issue 9.2 million unit IPO shares worth Rs 920 million – one the highest number of shares to be issued by any commercial bank.

The bank has already appointed Citizen Investment Trust, Nabil Investment, Growmore Merchant, Civil Capital and NCM Merchant as issue managers.

The bank which started operation in 2011 has deposits of Rs 10 billion and has dispensed loans amounting to Rs 8.5 billion.

The bank has more than 30 branches across the country.