Total net commission earned by brokerage companies has dropped by 10 percent during the fiscal year 2008/09. [break]
Releasing income statements of around two dozen stock brokers, Securities Board of Nepal (SEBON) -- the capital market regulator -- said total net commission earned by the brokers after deducting commission amount paid to Nepse declined to Rs 264.78 million during the fiscal year 2008/09 down from Rs 294.47 million recorded a year earlier.
“Broker commission fell as number of transactions during the year declined due to slowdown in stock market over the year. With the slackness in stock market, less number of investors approached the brokers to buy or sell stocks,” said Nanda Kishore Mundada, president of Nepal Stock Brokers´ Association. Mundada, who is also the proprietor of Shree Krishna Securities, said that impact of sluggish stock market was also reflected in total profit of brokers over the year.
He said with the expansion of services of stockbrokers outside the Kathmandu valley and operation of Central Depository System (CDS) - online trading of stock -- would boost transactions in coming days. Stock brokers are preparing to expand their services to major cities like Birgunj, Biratnagar, Narayanghat, Butwal, Pokhara and Nepalgunj soon.
Total commission received by brokers from the clients against their brokerage services has also dropped by 5.43 percent over the year. Total commission earned by brokers declined to Rs 263.39 million during 2008/9 from Rs 278.51 million recorded a year earlier. Slackness in stock market has also affected revenue collection as total commission furnished by stock brokers to Nepse went down by 9.86 percent to Rs 65.57 million during 2008/09.
According to SEBON, share brokers earned Rs 107.34 million in 208/09, down from Rs 137.95 million recorded during 2007/08. Due to slump in share transactions, total payable to Nepse has dropped to Rs 36.63 million at the end of 2008/09 from Rs 70.36 million recorded at the closing of preceding fiscal year.
prabhakar@myrepublica.com
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