Kathmandu: Life Insurance Companies are attracted towards operating their own investment management company.
In a row, two life insurance companies have already acquired the major stake on existing investment management companies. Asian Life Insurance has acquired Wealth Management and Merchant Banking Ltd and renamed it as Asian Capital Limited. Asian Capital is the first capital management company owned by an insurance company.
Similarly, leading life insurance company, Nepal Life Insurance has also acquired the major share of National Merchant Banker Limited. Its new paid-up capital is Rs. 300 million.
Among the new life insurance companies, Reliable Life Insurance Company has also taken steps towards the operation of a Capital and Investment Management Company. It has registered a sister concern named Reliable Investment and Merchant Capital Limited to the office of company registrar. Its authorized capital is Rs.500 million while the paid up capital is Rs.300 million out of which Rs.270 million has been arranged by the promoter share holder and remaining capital will be raised through IPO issue.
There are some more capital investment companies of Insurance Companies in pipeline. With the consortium, the insurance companies can share risk on a more profitable sector of investment.
The ‘Investment Guidelines for Insurers 2075’ issued by the Insurance Board of Nepal has paved way for the insurance companies to run their own investment management companies. Insurance Board is hopeful that with the emergence of Investment Management Company of the Insurance Companies, they can make better investment portfolio and multiply their return on investment.