No decision was taken in meeting with BSEC: Bangladesh Bank

The Bangladesh Bank has denied statements made by a Bangladesh Securities and Exchange Commission (BSEC) representative to the media regarding the outcome of a recent meeting between the two regulatory bodies.

The denial comes after BSEC Commissioner Dr Shaikh Shamsuddin Ahmed told reporters on Tuesday that the central bank had agreed upon the stock market regulator's proposals regarding banks' capital market exposure calculation, compliance with corporate governance code, and banks' dividend pay-out at the meeting held earlier on the day.

In a press statement on Wednesday, the Bangladesh Bank said no such decisions were made in its meeting with the BSEC.

The contradictory statements have further increased the ongoing policy dispute over the issues stated by the BSEC commissioner between the two regulators.

The central bank press statement read that Tuesday's meeting discussed issues regarding the transfer of unclaimed dividends within listed banks and non-bank financial institutions (NBFIs) to the Capital Market Stabilisation Fund created by the BSEC.

The regulators also discussed issues regarding banks' dividend payment out of a certain year's profit despite having cumulative losses, it added.

The Bangladesh Bank also said it informed BSEC representatives that the two proposed changes would not comply with the Bank Company Act 1991 and Financial Institutions Act 1993. Instead, the central bank added, it urged the BSEC to amend its own relevant notifications.

The meeting also discussed the capital market investment of scheduled banks and NBFIs among other topics, but no decision was taken there, said the Bangladesh Bank.

The bank further said that it clarified to the BSEC representatives that the restrictions to the banks and NBFIs' capital market investments were stated in the relevant acts.

BSEC Chairman Prof Shibli Rubayat-Ul-Islam on Wednesday met Prime Minister Sheikh Hasina to discuss the capital market.

"We pointed out the issues that are acting as hurdles for the market to move spontaneously," he told The Business Standard after the meeting.