SEBON Restricts Share Trading of Everest Insurance Citing Information Leak

Jun 20, 2017 Merolagani

 

Securities Board of Nepal (SEBON) has restricted share trading of Everest Bank. The board, citing leak of information regarding bonus share, right share and annual general meeting (AGM) before its announcement, directed Nepal Stock Exchange (NEPSE) to halt the share trading for investigation leading closure of share trading of the company.

 

The insurance company which called out for five AGMs at once proposed of distributing 20 percent bonus share and issuing 600 percent right shares. According to SEBON, the information was leaked before its announcement thus, it directed NEPSE to halt the share trading.

NEPSE after receiving the SEBON correspondence has restricted the share trading of Everest Insurance. The market price of the company's share reached Rs 2600 before the AGM proposal. After announcement of the AGM on Friday, its' price reached Rs 2580 from Rs 2458 on Wednesday. On Thursday, its price jumped to Rs 2645. Due to the information leak, the buying pressure of the share was gone up compared to selling.

After the announcement on Friday, the share price went to circuit on Sunday and reached Rs 2909 from Rs 2645. The price which went as high as Rs 3199 on Monday last traded at Rs 2930. Investors who bought the shares in low price earlier when started selling, the market saw huge number of share trading of the company.

However, NEPSE has restricted share trading of Everest Insurance after SEBON direction. The halted share trading might not open till the board investigate and close the matter.

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