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BSEC chairman: Errant institutional investors may see their status scrapped, registration cancelled

  • Published at 10:22 pm October 10th, 2018
Bangladesh Securities and Exchange Commission (BSEC) building in Agargaon Dhaka Syed Zakir Hossain/Dhaka Tribune

BSEC has organized the event in a bid to raise awareness among stock investors

The Bangladesh Securities and Exchange Commission (BSEC) Chairman M Khairul Hossain has  given a stern message to errant institutional investors, saying non-complying brokers, dealers, merchant banks and asset management companies will be excluded from the list of institutional investors.

“Even their registration could be cancelled,” Khairul said at a function on Tuesday night, adding some changes to the definition of institutional investors are being planned to ensure the transparency of the book building system.

He was speaking as the chief guest at a seminar organized to mark the World Investors Week 2018. The Dhaka Stock Exchange (DSE) organized the event at IDEB Bhaban, Kakrail.

Initial public offering (IPO) is the process by which a private company sells its shares to institutional investors and retail investors to raise funds. There are two types of IPOs – fixed price method and book building method. 

The BSEC chairman said: “BSEC is working relentlessly to protect the interests of investors.”

Earlier on Sunday, Khairul also made harsh remarks on the price manipulation by alleged institutional investors. He said the book building system would be suspended or stopped if needed for the sake of capital market.

At the seminar, Professor Helal Uddin Nizami, commissioner of the BSEC said: “The growth of Bangladesh's economy is hailed in different international forums but the country’s stock market does not match with the economy’s growth rate.” 

He said the stock market experienced many reforms in the last few years but big conglomerates are yet to come forward. Many big conglomerates do not want to share ownership of the entities with the public and abide by rules and regulations of the securities law, he added. 

Calling upon investors not to listen to rumors, the BSEC Member also said:“Various rumors are spreading in the market via mobile phones and other ways to encourage share sales before the upcoming national elections.”

Chaired by DSE Chairman Dr Abul Hashem, BSEC Commissioners Dr Swapan Kumar Bala, Khondoker Kamaluzzaman and DSE Managing Director KAM Majedur Rahman were present at the event.

BSEC has organized the event in a bid to raise awareness among stock investors. The week is being observed in accordance with a declaration of the International Organization of Securities Commissions (IOSCO)—a global platform for securities regulatory bodies.

To mark the occasion, BSEC has chalked out a seven-day program of cultural events, discussions, reunions, and seminars.

DSE and the Chittagong Stock Exchange (CSE) also arranged various other programs in Dhaka and Chittagong to mark the week.