Kathmandu. Nepal Rastra Bank (NRB) has further tightened the distribution of dividendto institutions except banks and financial institutions. Nepal Rastra Bank (NRB) has issued the Guidelines on Distribution of Dividend for institutions (except banks and financial institutions) licensed to carry out payment related activities.

Nepal Rastra Bank (NRB) has said that the financial condition of the organization needs to be strengthened for dividend distribution. Nepal Rastra Bank (NRB) has made it mandatory for companies other than banks and financial institutions to declare dividends and that the accumulated profits should not be negative. Similarly, dividend should be declared only on the basis of the financial statement of the year in profit of the organization and cash dividend cannot be declared from share premium and wargen purchase gain and the net worth of the organization should not be negative while distributing share dividend.

In order to declare cash dividend, the company should have sufficient cash reserves and the terms related to the loan consumed by the institution should not restrict the distribution of dividends. Similarly, companies that have serious implications that can create financial liabilities during on-site and non-on-site inspections conducted by the Rastra Bank will not be able to distribute dividends to shareholders.