The benchmark DSE General Index (DGEN) will be removed from the screen from August 1 as per earlier decision of Dhaka Stock Exchange. It was introduced in 2001 with a base point of 817.62.
In January, the prime bourse had decided that the DGEN will be displayed along with the new DSEX on the screen for some time so that people do not get confused.
The DSEX, developed by Standard and Poor's, was formally launched on January 28, based on the free-float method used by the world's major indices.
The DGEN, which contains inflated points due to faulty calculation and the need of a fresh index, was first came to the front in November, 2009 when Grameenphone (GP) was listed with the stock exchanges.
In another development, both DSE and Chittagong Stock Exchange (CSE) have submitted their comprehensive demutualisation scheme to the securities regulator yesterday, says a press release.
"Dhaka Stock Exchange is pleased to announce that it has submitted a comprehensive demutualisation scheme proposal to the Bangladesh Securities and Exchange Commission in accordance with Section 5 of the Act and within the set time table," it said.
The process of approval by the Commission and subsequent events will now follow a time table as specified in the Act, which requires the Commission to review and approve the scheme within 60 days from today's date and the exchange to hold an EGM of its shareholders within 30 days thereafter.
Upon demutualisation on the EGM date, the shareholders of the exchange will be provided with new shares representing the capitalised net asset value of the exchange as of March 31, 2013.
DSE president Ahasanul Islam Titu said: "The time table set for us was very challenging and we are very pleased to have complied with the Act in every respect. Today marks an important event in the 60-year history of our exchange and we now look forward to agreeing the scheme of demutualisation with our regulatory body, Bangladesh Securities and Exchange Commission, in order for us to embark upon our next phase of development."
The demutulisation of stock exchanges gives out a positive signal to investors and other stake holders that the excessive control enjoyed by brokers over the stock markets would end.
The Demutualisation Act passed in April 29 is aimed at separating the bourses' management from ownership with a promise to bring transparency to the stock market.
According to the law, the DSE is scheduled to submit a demutualisation scheme to the stock market regulator within 90 days of the gazette notification of the act. The BSEC will approve it within the next 60 days.
Stock exchange members or brokerage houses will hold 40% shares after the demutualisation of a bourse. The rest 60% will be kept for trading right entitlement certificate (TREC) holders, strategic investors and individuals.
Strategic investors will not be allowed to hold more than 25% shares of a stock exchange while no individual will hold more than 5%.
