Discussions will be held with the government keeping in mind three issues to provide short, medium and long-term policy support for the development of the capital market. These are investor benefits, solving the problem of market intermediaries and increasing market depth. A set of decisions will be taken in consultation with the government. The scope of this support will be for individual investors, institutional investors, high net worth investors and foreign investors.
Khandkar Rased Maqsood, chairman of the capital market regulatory body, said these things in an exchange meeting with journalists at the office of Bangladesh Securities and Exchange Commission (BSEC) in Agargaon of the capital on Tuesday (October 29).
BSEC Commissioner Mu. Mohsin Chowdhury, Ali Akbar and Farzana Lalarukh, Executive Director Mahbubul Alam and Mohammad Rezaul Karim.
In the said meeting, Khandkar Rased Maqsud said that the financial adviser has returned to the country. Within this week, a decision will be taken regarding the policy support for the development of the stock market on the basis of discussions with the advisors and related parties. Some of which will be implementable in the short term, while others will be implemented in the medium and long term.
The policy measures that have been taken include, taking necessary measures to increase the supply of liquidity in the market, assistance in providing funds to increase the investment capacity of the state-owned investment institution Investment Corporation of Bangladesh (ICB), taking necessary measures to use the money collected by BSEC through fines for the protection of investors, Reforming the IPO law and providing tax incentives to bring public and private good and profitable companies to the market faster, reducing the settlement time of the stock market to one day, finally settling the amount of unpaid accumulated negative debt (negative equity) in the lending institutions, high net worth individuals. Reduction of capital gains tax rate to encourage investment, determination to introduce share buyback system, no future imposition of floor price on increasing foreign investment, ensuring good governance and due observance of law.
The chairman of BSEC said that there has been a big fall in the share market in recent times due to several reasons. In this situation, the development of the market will be discussed with the government keeping three things in mind. These are investor benefits, solving the problem of market intermediaries and increasing market depth. Tax incentives should be given to attract investors to invest and tax incentives should be increased to attract good companies to list. Recently, the Ministry of Finance announced in a statement to give incentives to general investors, how and to whom it will be given. It will be discussed with the government. Government will be requested to speed up the issue of providing financial assistance to ICB. Apart from this, there will be discussions with the government about what legal measures can be taken regarding share repurchase.
During the exchange of views, journalists working on the stock market highlighted various problems and recommendations of the market based on their work experience. These recommendations were recorded by the Commission.
After speaking to the journalists, the commission said that the commission will take effective steps to solve the problem of marginal debt and negative equity in the market. The commission does not want to interfere in day-to-day market ups and downs. However, law enforcement efforts will be made to restore order in the market. The commission also said that they have already met with several leading entrepreneurs of the country to bring good companies to the market. The commission is working to bring good multinational, public and private companies to the market. Besides, emphasis is being placed on digitization to facilitate the information delivery process, the journalists were informed.
Rashed Maqsood also said that many investors have left the market due to the imposition of a minimum price level or floor price on share prices for a long time. Especially foreign investors have turned away from the stock market of Bangladesh. Again due to high tax rates wealthy people have lost interest in investing. On the other hand, institutional investors are now more interested in investing in treasury bill-bonds due to higher interest rates. Therefore, various steps will be taken to increase institutional investors in the stock market. For this purpose, he also informed about the plan to make the mutual fund sector more active.
During the exchange of views, it was informed by the commission that no action has been taken despite the investigation against various irregularities during the past commissions. Due to this, 276 investigations remain incomplete. It is also reported that the Commission is actively considering reducing the transaction settlement time to one day to improve the liquidity situation of the stock market.
Chairman of BSEC said, ‘In the last two months, we have had many discussions with various parties related to the market. The commission is working to solve the obstacles that have come up in the development of the market in these discussions. All in all, we assure investors that they will get good things in the future. At present, the work of reforms in various aspects of the state is going on. As a part of that, various reforms will be implemented in the capital market in the short, medium and long term, which will benefit the investors. The current commission is committed to building a prosperous capital market by ensuring good governance and accountability
