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  • Last Update : 03:43 pm

DBH 1st MF Liquidation: BSEC asks trustee to convene meet for liquidation decision

  • Published at 11:55 pm October 14th, 2019
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File photo of Bangladesh Securities and Exchange Commission Office in Dhaka Syed Zakir Hossain/Dhaka Tribune

Earlier, 78.42% unit holders of the closed-end DBH First Mutual Fund sought to liquidate the fund, which will be matured in February, 2020

The securities regulator asked Bangladesh General Insurance Company (BGIC) Limited, the trustee of DBH First Mutual Fund, to hold a unit holders’ meeting.

On the other hand, BGIC asked LR Global, the asset management company of the mutual fund, to arrange a meeting by October 21 after 78.42% of the unit holders of the fund had opted for a meeting to liquidate the fund.

Earlier, 78.42% unit holders of the closed-end DBH First Mutual Fund sought to liquidate the fund, which will be matured in February, 2020.

The unit holders’ proposal came after LR Global had sought extension to the BSEC for another 10 years.

According to the mutual fund rules 2001, with the prior approval of the Bangladesh Securities and Exchange Commission (BSEC), a closed-end mutual fund could be converted into an open-end one if at least 75% of its unit holders favoured the conversion.

A top official of BSEC yesterday told Dhaka Tribune that the Commission had sent a letter to the trustee, asking it to call a meeting as per securities rules.

Managing director of BGIC Ahmed Saifuddin Chowdhury told Dhaka Tribune: “Today (Monday), we sent a letter to the asset management company LR Global to let us know on the details of the meeting by 21 October.”

In September 2018, BSEC extended the tenure of 30 closed-end mutual funds by 10 years. LR Global was not on that list.

The majority of the DBH first Mutual Fund’s unit holders including sponsor Delta BRAC Housing Finance Company and 12 corporate houses (unit holders) wanted to liquidate the DBH Mutual Fund in February, 2020.

LR Global opts for extension of DBH First Mutual Fund for another 10 years up to February 6, 2030. 

Meanwhile, unit holders of the mutual fund informed the BGIC that the liquidation process had to be completed by January 15, 2020.

Yesterday, a unit price of DBH First Mutual Fund closed at Tk 8.50 on the Dhaka Stock Exchange (DSE). On October 10, the fund has reported Net Asset Value (NAV) of Tk. 9.90 per unit on the basis of current market price and Tk. 10.11 per unit on the basis of cost price against face value of Tk. 10.00.

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