MoU signed to set up new ratings agency
Sep 1, 2016-
India’s CARE Ratings on Wednesday signed a Memorandum of Understanding (MoU) with Vishal Group Limited and Emerging Nepal Limited to start a credit rating agency in Nepal named CARE Ratings (Nepal) Limited.
With this, the country will now have two such agencies -- the other being ICRA Nepal.
Securities Board of Nepal has made credit rating mandatory for companies to hold public issuance exceeding Rs30 million.
According to the Credit Rating Agency Regulation, companies planning to issue ordinary shares, bonds, debentures, rights share and preference shares exceeding Rs30 million in value have to get themselves credit-rated.
Vishal Group Limited is a public limited company in financial services and part of the Vishal Group, while Emerging Nepal Limited, also a public limited company, involved in venture capital activities.
As per the MoU, CARE Ratings will hold a 51 percent of the equity with an investment of Rs 20 million in the new agency, while Vishal Group will own 19 percent and Emerging Nepal Limited 10 percent.
The remaining 20 percent will be held by banks, insurance companies, FIs and corporate bodies in Nepal subject to a maximum of 9 percent per legal entity.
Speaking at the signing ceremony, Rajesh Mokashi, Managing Director & CEO of CARE Ratings said: “This is another small step in our global forays plans and we do see a lot of opportunity in not just growing the market but also developing different avenues for rating, grading, training, research and information services. With two of the best companies as our partners with varying expertise, I am confident that this venture will set new benchmarks to be emulated in Nepal.”
Vishal Group CMD Ashok Kumar Agrawal termed the tie-up a “historic occasion”. “Their (CARE Ratings’) experience and capability will help in the further growth and evolution of the Nepalese capital markets and the economy, and better information will benefit the regulator, the Banks, Financial Investors and even the Public in General,” he said.
Mani Joshi, chairman of Emerging Nepal, added the MoU was in line with the strategic intent of Emerging Nepal to fill key gaps in the financial ecosystem of Nepal.
Published: 01-09-2016 09:10