Nepal: Insurers in rush to raise capital to meet new rule
Source: Asia Insurance Review | Jan 2018
Insurers are racing to issue rights and bonus shares to meet capital requirements laid down by the Insurance Board (IB).
According to the Securities Board of Nepal, six insurers have applied for permission to issue rights shares worth a combined NPR3.42 billion (US$33.5 million) in the first four months of this fiscal year that began on 16 July.
Meanwhile, Prudential Insurance, a non-life insurer, has issued 1,283,040 rights shares worth NPR128.30 million to its shareholders while seven have registered bonus shares valued at NPR990.32 million, reported The Kathmandu Post.
The IB has directed insurance companies to boost their capital fourfold by mid-July 2018, with the minimum capital of a life insurer to be NPR2 billion and that of a non-life insurer to be NPR1 billion.
There are 17 non-life insurers and 19 life insurers operating in the country. A