Citizens Investment Trust to double paid-up capital to Rs 250m

The Finance Ministry has approved a budget of Rs 12.5 million to be invested in the Citizens Investment Trust (CIT) to increase its paid-up capital to Rs 250 million. The government has a 10 percent stake in the CIT with Rastriya Beema Sansthan holding 26 percent, Nepal Rastra Bank 13 percent, the Nepal Stock Exchange 10 percent and the public 20 percent of its shares.

The CIT gives options to people for their savings and benefits them by investing their savings in the capital market and other businesses. The CIT aims to increase its paid-up capital to Rs 250 million from Rs 125 million. It is planning to issue rights shares on the basis of 1:1 ratio within the current fiscal year to increase the capital. "Given an increase in our business, we are in greater need of increasing our paid-up capital which paves the way for further business," said CIT executive director Rishiram Gautam.

The CIT may have to increase its paid-up capital to Rs 500 million to continue its mutual fund type Citizens Unit Scheme because the newly brought mutual fund regulation has provisioned that a mutual fund should have a paid-up capital of Rs 500 million. "This is another reason that we are set to increase our paid-up capital," said Gautam. The CIT's activities related to the capital market are governed by the Securities Board of Nepal.

It has been mobilising financial resources of around Rs 22 billon currently. Of that amount, it has deposited more than Rs 9 billion in commercial banks, Rs 3 billion in finance companies and Rs 2.5 billion in development banks. It has invested Rs 1.62 billion in government bonds, it has issued credit worth Rs 3.22 billion to its members, and put Rs 2 billion in debentures and Rs 650 million in term loans. Currently, it is also planning to diversity its investments in the infrastructure sector including hydropower, housing and road projects.

Source:
ekantipur