Shares of Kist Bank worth half a million rupees were traded on the stock market today—the first trading day since the transactions were suspended ten months ago.
Kist Bank’s share trading was halted on March 21 after the bank signed a merger agreement with Vibor Bikas Bank. However, both the financial institutions had called off the merger last month, which paved the way for their shares to be traded on Nepal Stock Exchange (Nepse).
Kist’s shares opened at Rs 137 per unit today and closed at Rs 150 per unit. Nepse saw trading of 410,479 units of the bank’s shares in 11 transactions.
“At present, shares of Kist Bank are the cheapest among stocks of commercial banks, so investors are speculating its price to go up further along with the market rally,” a stockbroker said. The stock index has increased by about 40 per cent in last five months.
Vibor’s shares also ended Rs eight higher at Rs 117 by the end of the day. The institution’s 1350 units of shares worth Rs 156,470 were traded in four transactions.
Shareholders of both the banks were eagerly waiting for the trading to resume—especially because the market is currently witnessing a bull run.
“Share prices of these banks could have further gone up today but the market was flooded with sellers—with very few buyers—so many orders were not executed,” informed the stockbroker.
Kist Bank has been incurring losses for the last five quarters and its non-performing assets stand at 7.5 per cent of total credit portfolio—which is higher than those of two state-controlled banks. Moreover, Kist Bank’s former CEO Kamal Gyawali had to resign from his post due to involvement in embezzlement of funds at the bank. His resignation was one of the major reasons that led to termination of the merger agreement with Vibor Bikas Bank.
Any financial institution pursuing merger formally needs to inform about its decision to the stock exchange, which, in turn, suspends the trading till the process is complete. Earlier, some investors had taken advantage of mergers or upgrades to drive up share prices of companies to unsustainable heights. So to protect investors from the eventual bust, the stock market operator halts share trading of companies that are undergoing processes like mergers.
source: the himalayan times,9 Dec 2013
LINK
Kist Bank’s share trading was halted on March 21 after the bank signed a merger agreement with Vibor Bikas Bank. However, both the financial institutions had called off the merger last month, which paved the way for their shares to be traded on Nepal Stock Exchange (Nepse).
Kist’s shares opened at Rs 137 per unit today and closed at Rs 150 per unit. Nepse saw trading of 410,479 units of the bank’s shares in 11 transactions.
“At present, shares of Kist Bank are the cheapest among stocks of commercial banks, so investors are speculating its price to go up further along with the market rally,” a stockbroker said. The stock index has increased by about 40 per cent in last five months.
Vibor’s shares also ended Rs eight higher at Rs 117 by the end of the day. The institution’s 1350 units of shares worth Rs 156,470 were traded in four transactions.
Shareholders of both the banks were eagerly waiting for the trading to resume—especially because the market is currently witnessing a bull run.
“Share prices of these banks could have further gone up today but the market was flooded with sellers—with very few buyers—so many orders were not executed,” informed the stockbroker.
Kist Bank has been incurring losses for the last five quarters and its non-performing assets stand at 7.5 per cent of total credit portfolio—which is higher than those of two state-controlled banks. Moreover, Kist Bank’s former CEO Kamal Gyawali had to resign from his post due to involvement in embezzlement of funds at the bank. His resignation was one of the major reasons that led to termination of the merger agreement with Vibor Bikas Bank.
Any financial institution pursuing merger formally needs to inform about its decision to the stock exchange, which, in turn, suspends the trading till the process is complete. Earlier, some investors had taken advantage of mergers or upgrades to drive up share prices of companies to unsustainable heights. So to protect investors from the eventual bust, the stock market operator halts share trading of companies that are undergoing processes like mergers.
source: the himalayan times,9 Dec 2013
LINK
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