Dhaka Stock Exchange (DSE) member TREC holder Sonali Securities Limited (Trec number-261) has been accused of non-compliance with the Securities Act. As per the Securities Act, it is mandatory for the brokerage house to maintain a net asset value (NAV) of more than 75 percent of the paid-up capital. But since the company’s NAV is below the prescribed limit, the capital market regulatory body Bangladesh Securities and Exchange Commission (BSEC) has formed an investigation committee to look into the activities of Sonali Securities.
According to Sonali Securities’ financial report for the financial year ended June 30, 2023, the NAV of the company is 69.20 percent of paid-up capital, BSEC said. Which is below 75 percent of paid up capital as per securities laws. According to the Securities Act, failure to comply with this condition risks cancellation of the company’s TREC certificate.
A three-member inquiry committee has been constituted to look into the activities of Sonali Securities in the larger interest of the capital market and general investors. The committee has been directed to submit its report within 60 working days.
According to BSEC sources, the order of such investigation against Sonali Securities has already been sent to their managing director.
The members of the investigation committee are Additional Director of BSEC Umme Salma, Assistant Director Mizanur Rahman and Assistant Director Md. Raihan Kabir.
During the previous government, there were violations of the law against several brokerage houses, but no strict action was taken. However, after the political change, the new commission is taking strict steps to stabilize the capital market and protect the interests of investors.
Besides, Sonali Securities Limited is a subsidiary of Sonali Paper and Board Mills Limited listed in the capital market. The BSEC has also set up an inquiry and investigation committee, which will look into past irregularities, manipulation and corruption in the capital market.
The inquiry committee constituted has been directed to investigate the abnormal rise in the share price of Sonali Paper and Board Mills Limited, the re-listing of the company’s shares on the main board of the Dhaka Stock Exchange in 2020.