BSEC seeks investment strategy from institutions

The Bangladesh Securities and Exchange Commission (BSEC) has asked institutional investors to submit a comprehensive investment proposal listing all the issues through Bangladesh Merchant Bankers Association (BMBA), so that the regulator can take steps to resolve them.

The securities regulator recommended this on Monday in a meeting with the representatives of banks, financial institutions and corporate entities.

In the meeting, BMBA President Md Sayadur Rahman said at present, investors who hold 10% or more shares of a company are not eligible to buy or sell their shares without approval from the stock exchanges. He proposed that the limit should be increased to 25%, BSEC sources said.

Sayadur Rahman also proposed that the price-earnings ratio regarding marginable shares should be calculated based on audited financial statements instead of quarterly ones, the sources mentioned.

The banks' representatives claimed that they cannot play a proper role in the capital market due to the exposure limit, which is set by the Bangladesh Bank. As per the limit, a bank can invest a maximum of 25% of its paid-up capital.

The representatives pointed out that it should be determined through a case by case basis. The securities regulator can discuss this matter with the central bank.

BSEC Chairman Professor Shibli Rubayat-Ul-Islam said the regulator will discuss this with the central bank to fix the issue so that intermediaries can play a vital role in creating confidence in the capital market.

The commission's Executive Director and spokesperson Mohammad Rezaul Karim said a fruitful discussion was held with the institutional investors. They brought up several issues for discussion, which are causing problems regarding investment in the capital market. The BSEC chairman has assured that it will be resolved gradually.

He also said the chairman has directed the banks to actively invest their incentive fund – which is Tk200 crore for each institution.

Daily Market

Indices of the both stock exchanges posted a positive trend on Monday after last two days consecutive losses.

At the end of the trading session, DSEX, the prime index of the Dhaka Stock Exchange (DSE), gained 97.44 points to reach 5,545. DSES Shariah Index rose by 21.60 points to 1,260 and blue-chip index DS30 jumped by 46.15 points to 2,146.

During the trading session, 226 companies' share price increased, while 34 companies' share price dropped and 91 remained unchanged.

Beximco Ltd secured the top position of the turnover chart. It contributed 25% of the DSE total turnover. Its share price also rose by 4.39% to Tk95.10 each during the trading session.

Bay Leasing and Investment Ltd, a non-banking financial institution, gained the top position in the gainer list with 9.58% price hike without any price sensitive information, while the Golden Son was the worst performer in the DSE on Monday.