These past two weeks, a total of 8 companies auctioned their unclaimed right shares. Out of the 8 companies, Nepal Bank, Nerude Laghubitta, Citizens Bank and Garima Bikas Bank are refunding within Asadh. Laxmi Bank is also partially refunding the auction non-allottees through IPS from Friday.
However, the issue managers of other companies—Sanima Bank, Nepal Bangladesh Bank and Siddhartha Development Bank, are only refunding after Shrawan.
| Company |
Issue Manager |
Bid Opening Day |
Allotment/Refund Date |
Refund Method |
| Nepal Bank Limited |
Civil Capital Market Limited |
Asadh 20 |
Asadh 25 (to Civil Bank) and Asadh 26 to other banks |
Direct Bank Transfer |
| Nerude Laghubitta Bikas Bank Limited |
Sunrise Capital Limited |
Asadh 21 |
Asadh 28 |
Refund Warrant |
| Nepal Bangladesh Bank Limited |
Global IME Capital Limited |
Asadh 23 |
Allotment on Asadh 30, refund 3 days after allotment |
Direct Bank Transfer |
| Citizens Bank International Limited |
Sanima Capital Limited |
Asadh 23 |
Asadh 30 |
Direct Bank Transfer and Refund Warrants |
| Sanima Bank Limited |
CBIL Capital Limited |
Asadh 23 |
Shrawan 1 |
Direct Bank Transfer |
| Siddhartha Development Bank Limited |
Nabil Investment Banking Limited |
Asadh 23 |
Shrawan first week |
- |
| Laxmi Bank Limited |
Laxmi Capital Market Limited |
Asadh 25 |
Asadh 30 (IPS) and Shrawan 1 (refund warrants) |
Direct Transfer and Refund Warrants |
| Garima Bikas Bank Limited |
Ace Capital Limited |
Asadh 26 |
Allotment on Asadh 27, refund from Asadh 29 |
Direct Bank Transfer |
Ace Capital, which received bids from 1000 applicants for Garima Bikas Bank, is refunding auction non-allottees only 4 days after the bid opening day and 3 days after allotment. Likewise, Nepal Bank also refunded money within 5 days.
However, majority of companies are refunding money only after 10 days of bid opening day. Allotment of shares auctioned by Siddhartha Development Bank still has not been final by the BOD of the bank, and will be refunded only 3 days after the allotment. This means that the auction non-allottees will only be able to get their money back in Shrawan.
The Securities Issue and Allotment Guidelines 2074 also does not have a concrete timeframe as to when the auctioned shares should be allotted. Hypothetically, if the BOD of a company don’t endorse the allotment for 10 days, the money is not refunded in 13 days. On top of that, the issue managers also don’t provide interest on the money—which has created a huge inconvenience to investors. This loophole in the regulation has allowed companies to continue generate interest on the money bid by investors, while investors are left with nothing in return. Regulatory authorities should also draw their attention towards fixing such loopholes for the betterment of capital market.
