BMBA seeks Tk6,000cr soft loan from govt

“The merchant banks are facing severe problem due to rising default loan since the market crash,” said Md Sayadur Rahman, president of BMBA, during a meeting with Finance Minister AMA Muhith at the ministry yesterday. Equity of most clients of the merchant banks particularity dealing with share lending went negative due to weak market situation, leading to pile of margin loans that remained as unrealised losses for long. In 2010, the government directed the brokerage houses and merchant banks not to adjust margin loans of the stock market traders for the sake of market, resulting in a huge amount of funds remaining stuck-up. “To overcome the situation, we have requested the finance minister to provide Tk6,000 crore loan at a lower interest rate,” BMBA president Md Sayadur Rahman told reporters after the meeting. “Such funds would help boost the stock market as negative accounts will have purchase power once our proposal is implemented,” he said. The BMBA president claimed that the finance minister took their proposal positively and assured them of holding talks with the Bangladesh Securities and Exchange Commission. The BMBA came up with the proposal at a time when a Tk900 crore refinancing scheme got tepid response from the affected stock investors. According to the latest data, state-owned Investment Corporation of Bangladesh, entrusted with the fund management through merchant banks and brokerage firms, has so far disbursed over 70% of the total fund since mid-2013.