Stockbrokers stop working on behalf of Nirmal Pradhan

KATHMANDU:

All stockbrokers will stop working on behalf of Nirmal Pradhan, a major player at the domestic stock market, from Sunday onwards until ownership of shares of Nepal Bangladesh Bank (NBB) sold by Pradhan are transferred to investors, who stand to lose close to Rs 130 million.

A decision in this regard was taken by the full-body meeting of the Stockbrokers Association of Nepal (SBAN) today, participated by all 50 member stockbrokers.

“We won’t trade shares of Pradhan and even NBB unless the ownership of shares worth around Rs 132 million are transferred to 1,000 investors who bought them,” SBAN president Narendra Raj Sijapati said. “We had to do this as many investors are losing confidence in the stock market due to the reckless attitude of a few.”

The problem surfaced after Pradhan sold all NBB shares pledged as collateral by Laxmi Bahadur Shrestha, a promoter of NB Group and a former NBB director, when obtaining a loan from Pradhan. It is said Shrestha had pawned 220,000 units of NBB shares to obtain the loan. Of these shares, 129,905 were held by Pradhan and the rest by Shanker Kumar Shrestha, who apparently has also sold all shares deposited by Laxmi Bahadur as security.

After the shares were sold, Laxmi Bahadur moved the Kathmandu District Court. At the court, he showed a supplemental agreement signed with Pradhan, which stated ‘Pradhan was barred from selling shares pledged as collateral’. The district court then issued a verdict ordering concerned authorities to stop transferring ownership of shares sold by Pradhan.

“At least 1,000 investors who bought these shares are left in the lurch as the authorities are not willing to transfer ownership citing the court order,” Sijapati said. “We want Nepse and Securities Board of Nepal to protect interest of investors.”

Pradhan, on the other hand, said, “I’m not involved in sale of these shares and they were actually auctioned by Narayani National Finance, from where Shanker Kumar had taken Rs 8.75 million and Muskan Shrestha had acquired another nine million on behalf of Laxmi Bahadur.”

Sebon chairman Baburam Shrestha, meanwhile, said nobody has officially informed him about the case. “We will do whatever necessary once we officially get the details.”

Source: THT