The Securities Board of Nepal (SEBON) has prolonged the timeline for stock brokerage firms to achieve the minimum paid-up capital threshold by an additional nine months.
Previously, SEBON suggested a revision to the Securities Businessperson (Stock Broker and Stock Dealer) Regulations, 2064, seeking extra time for brokers who could not reach the capital requirement, and forwarded it to the Ministry of Finance for their endorsement.
Sources indicate that the Ministry greenlit the amendment on Monday, allowing the extension. Consequently, stock brokerage firms that were required to fulfill the capital criteria by the end of Ashad 2082 now have until the conclusion of Chaitra 2082.
The resolution to request an extension was reached during SEBON’s board meeting last week, after it was revealed that 23 brokerage firms fell short of the mandatory capital. On the 8th of Poush 2081, SEBON had issued a notice prompting non-compliant brokers to present plans for capital increase, which justified the nine-month extension.
According to SEBON, firms unable to satisfy the requirement through profit-driven capital must either infuse new capital or consider merging with others.
In Bhadra 2079, SEBON revised the regulations to significantly elevate the minimum capital requirement—up to 30 times more for new license applicants. The amendment also established a tiered classification system for brokers:
Limited Transaction Brokers: Rs. 20 crore
Full Transaction Brokers: Rs. 60 crore
Stock Dealers: Rs. 1.5 billion
Under the updated regulations, 42 stock brokers received licenses. However, current brokers were initially allotted until the end of Ashad 2082 to comply, which has now been extended due to the failure of 23 companies to meet the deadline.
