• Tuesday, Nov 19, 2019
  • Last Update : 09:39 pm

Bourses suspend trading of People’s Leasing shares

  • Published at 09:46 pm July 14th, 2019
People’s Leasing liquidation move leaves depositors worrying
Photo : Dhaka Tribune

The DSE decided to suspend share trading of the ailing non-bank financial institution in accordance with Regulation 50 of the Dhaka Stock Exchange (Listing) Regulations, 2015

Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) on Sunday suspended the trading of People's Leasing and Financial Services’ (PLFS) shares.

The DSE decided to suspend share trading of the ailing non-bank financial institution in accordance with Regulation 50 of the Dhaka Stock Exchange (Listing) Regulations, 2015, said an official of DSE.

According to the DSE disclosure, the decision was made at a board meeting held on Thursday. The non-bank financial institution’s share trading will be suspended until getting confirmation from Bangladesh Bank on liquidation of the company.

Meanwhile, Bangladesh Bank yesterday filed a petition with the High Court, seeking permission to liquidate People’s Leasing as the organization’s financial health deteriorated badly in recent times because of its loan irregularities.

The High Court accepted the petition and passed an order to freeze all bank accounts of former directors of People's Leasing, who were appointed before 2015.

Due to the continued losses, the listed PLSF failed to announce any dividend since 2014.

Each People’s Leasing share closed at Tk 3.0 on Thursday last.

Of the total shares, 67.48% are held by general shareholders, 23.11% shares by sponsors and directors, 8.77% shares by institutional investors and 1.19% shares by foreign investors.

The company was listed at DSE in 2005.

Earlier on June 27, the finance ministry instructed the central bank to close the NBFI for its failure to improve its conditions.

The ministry arrived at the decision after going through a detailed central bank report on PLFS.

The NBFI has failed to repay the depositors’ money despite maturity of the funds, found the Bangladesh Bank report. Default loans and net losses have recently escalated as well.

At the end of September, 2018, the total amount of deposits of PLSF stood at Tk2,086crore. But they do not have any cash to run daily activities.

The total amount of outstanding loans stood at Tk1,131crore. Their defaulted loans stood at Tk748crore, which was 66.14% of the total loans, according to the Bangladesh Bank data.