Bankers call for lifting circuit breaker on T-bond transactions
Bankers, in a meeting with the capital market regulator on Wednesday, called for lifting the circuit breaker to popularise the bond market.
To increase the treasury bond transactions, the bankers came up with some other demands which they said are essential for a vibrant bond market.
On 10 October, trading of treasury bonds began on the Dhaka Stock Exchange on an experimental basis. There is a 2% circuit breaker on the trading.
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The ceiling resulted in banks, who are reluctant to sell, holding most of the bonds. This has created a supply crunch as the market shows a significant demand.
In this situation, the regulator Bangladesh Securities and Exchange Commission (BSEC) sat with the treasury heads of all banks and sought cooperation to make treasury bond transactions vibrant.
The regulator also sought bankers' cooperation to further increase investment in the capital market by banks.
"The bankers have raised various issues. We have assured them whatever the regulator needs to do to make the bond market vibrant, everything will be done," Shaikh Shamsuddin Ahmed, acting chairman of the BSEC, told The Business Standard.
A number of treasury heads who joined the meeting told The Business Standard that bankers have emphasised increasing investor awareness in treasury bonds. Besides, they also suggested lifting commission in bond transactions.
Bond transactions now cost Tk0.10 per Tk100 as commission, which is transacted free of cost in the Bangladesh Bank's Market Infrastructure Module.
Besides, instead of listing all treasuries, bankers suggested listing the securities that will give good returns.
BSEC spokesperson Mohammad Rezaul Karim told The Business Standard, "The issue of perpetual bond listing and subscription was discussed along with treasury bond transactions."
"Bonds held by banks have been asked to transfer to BO IDs to ensure the supply to the capital market," he said.
He also said that the commission has assured cooperation and requested to scale up investments by banks in the capital market.
