BSEC for overseas outlets of local brokerage houses

Bangladesh Securities Exchange Commission (BSEC) on Sunday requested the Bangladesh Bank (BB) to allow Bangladeshi brokerage houses to open overseas outlets.

It also requested the central bank to urge the country's banks to increase investments in the capital market.

BSEC Chairman Shibli Rubayat Ul Islam made the requests during a meeting with the BB Governor Fazle Kabir.

Coming out of the meeting, BSEC Executive Director Mahbubul Alam said, "By law, banks can invest 25% of their paid-up capital in the capital market, but many banks are not showing interest in investing within the stipulated limit. In this context, BSEC has requested for more bank investments in the stock market."

"Merchant banks and brokerage houses are not being able to invest more due to lack of capital. So, we requested the governor to arrange easy loans at low-interest rates for them," he added.

In reply to a question, Mahbubul Alam said, "BSEC urged to mobilise a Tk 10,000 crore probable loan fund through ICB, arguing that being backed by the fund, merchant banks and brokerage houses will be able to become more active in the market."

"We also requested the central bank to allow Bangladeshi brokerage houses to open overseas outlets. In response, the BB governor said that they would scrutinise first whether the approval violates the foreign exchange regulation policy," said the BSEC official, adding once the approval is given, foreigners, as well as Bangladeshi expatriates, would be able to carry out transactions with the capital market.

The meeting also discussed what steps can be taken to develop the listed banks and financial institutions listed under the 'Z' category. 

"The central bank governor has assured us to fulfil our demands," informed Mahbubul Alam.