NB Insurance
that has been in news for failing to comply with the regulatory norms have
finally been suspended today, according to the insurance market regulator, Insurance
Board.
The
insurance company that has sold some 6,867 policy in the cuirrent fiscal year
2013-14, has around 900 claims. But after repeatedly bypassing the regulatory
directives, the regulator today padlocked the non-life insurer that is promoted
by the notorious NB Group.
The central
bank had also freezed its accounts some two months ago after the Insurance
Board sought the Nepal Rastra Bank's help, as it failed to get its act together
despite repeated regulatory calls.
The
Insurance Board had asked the central bank to freeze the NB Insurance accounts also
because it failed to implement reforms in various sectors despite repeated
calls in the last one-and-a-half years.
The
insurance company landed in trouble in February 2012 after it's controversial
payment of Rs 59 million – paid as house rent without taking regulator's
consent – was revealed. The insurance companies are not allowed to make
expenses in excess of Rs 2 million without taking the Board's permission. It
had also managed to siphon off over Rs 70 million from the reserve.
Earlier to
the Board had suspended the operating licence of NB Insurance for two months in
July 2012. But the company instead of improving its past mistakes and ensure
good corporate governance, went on making new mistakes.
The non-life
insurance company has also not renewed, and has deposited Rs 35.30 million in
the crisis-hit World Merchant Bank and Finance that is under central bank
scanner. The Nepse-listed insurance company has also not increased it paid up
capital to Rs 250 million, according to the regulatory requirement and still
has only Rs 141 million paid up capital. It has incurred a loss of Rs 44
million last fiscal year. NB Insurance per unit Rs 100 paid up share was traded
at Rs 80 at the Nespe also due to its suspicious transactions.
In October, the Board had
also asked the troubled NB Insurance to get its Due Diligence Audit (DDA) to
get its real financial picture.
No comments:
Post a Comment