Insurers flouting share market listing directive
The finance minister in last September warned that tough action would be taken against an insurance company if it failed to be listed on the bourses by three months
Not a single insurance company has turned up to be listed on the bourses since the September 2019 directives given by the finance minister and the insurance regulator.
Now, the Insurance Development and Regulatory Authority (IDRA) says it will sit with the companies on January 29. The meeting will discuss how much time the 18 insurance companies would take for submitting the listing application.
The finance minister in last September warned that tough action would be taken against an insurance company if it failed to be listed on the bourses by three months.
After the warning, the IDRA asked the non-listed insurers to be listed by December 2019.
Md Shafiqur Rahman Patwary, chairman of the regulatory authority, said they sent letters to the executives of the companies with a similar directive on September 16 last year.
But no insurance company has applied to the Bangladesh Securities and Exchange Commission to be listed since then, said commission sources.
Before the repeated instructions from the regulator and the finance minister, four insurance companies applied to the commission to be listed.
In the meantime, five other insurers are in the process to be listed. The IDRA says these five companies are financially stable to be listed on the market.
The companies are — Guardian Life Insurance Company Limited, LIS Bangladesh Limited, Sena Kalyan Insurance Company Limited, Meghna Insurance Company Limited, and Chartered Life Insurance Company Limited.
Previously, Express Insurance, Desh General Insurance, Cristal Insurance Company, and Sonali Life Insurance Company applied to the Bangladesh Securities and Exchange Commission for raising funds of Tk26.79 crore, Tk16 crore, Tk16 crore and Tk19 crore respectively from the share market.
The number of IDRA certified companies in Bangladesh is 79. One of them is out of operation.
Of the 78 functioning companies, 47 are listed on the share market.
According to the companies law rules, banks and insurance companies must get listed on the capital market within three years after they become public limited companies.
If a company fails to be listed on the capital market within the stipulated timeframe, it can get a six-month extension upon providing logical grounds for the delay.
For violation of this rule, there is a provision to impose fine on the company.
