New Regulations Mandate 1 Billion Capital for Bond Issuance
Summary
SEBON has proposed new regulations that would require a minimum capital of one billion rupees for issuing bonds in Nepal. The draft also expands bond issuance beyond banks and financial institutions, while adding stricter safeguards such as credit ratings, trustees, and collateral requirements.
Key Points
- SEBON’s draft Bond Registration and Issuance Regulations, 2083, makes one billion rupees of capital mandatory for bond issuance.
- The new rules open the bond market to manufacturing and other organized institutions, but require secured bonds, debt-to-capital limits, audited accounts, and no loan defaults.
- Bond trustees will get stronger powers, including control and auction of pledged assets if issuers fail to repay investors on time.
- The draft also introduces thematic bonds, foreign issuance options, and a separate trading platform to deepen Nepal’s capital market.
