Investment Corporation of Bangladesh (ICB) the state owned capital market intervener are in deep financial crisis as it incurred over Tk 1000 crore loss due to Coronavirus pandemic
The ICB is suffering loss over Tk 500 crore for the unrealized portfolio which went down following DSE index dropped into 4000 points from 5600 points in January.
“The ICB also experienced losses of over Tk 300 crore capital gain in April and May it could have earn in normal situation as well Tk 100 crore dividend from shares it holds,” Md. Abul Hossain, managing director of ICB told Business Mirror.
The corporation also bleeding from operational losses as well incurred losses from its other sister concerns, Mr. Hossain said
Mr. Hossain proposed the Senior Secretary of Financial Institutions Division (FID) to setup strategic buyers among whom the ICB can offload some of its shares to offset the ongoing crisis.
Earlier, The ICB incurred losses for last two consecutive quarters ended by December, 2019 due to ‘decrease’ in capital profit and ‘increase’ in loan interest. It also incurred losses mainly because of its market supportive role.
The ICB had Tk 1000 crore loan taken from different organisations and capital market refinancing scheme for the purpose of market support.
The ICB Md said there is a huge volume of saleable shares in ICB portfolios but ICB could not sold those shares to avert the negative impact on the stock market.
However, the ICB had a plan to collect Tk200 crore by issuing a bond to overcome the cash crisis remained before Coronavirus pandemic. It had issued Tk2,000 crore bond earlier.
The ICB has recommended giving a 10 percent stock dividend to the shareholders for the fiscal year 2018-19. For this, the record date is November 18. The company will held its Annual General Meeting (AGM) on December 21, 2019.
But during the period, the ICB’s profit fell by 86 percent and stood at Tk60 crore, its EPS was Tk0.86.
During the previous year (the fiscal year 2017-18), the ICB gave 30 percent cash dividend and 5 percent stock dividend. And the company’s net profit was Tk416 crore and the EPS Tk5.97.
Upon information of loss in the first quarter, the ICB share price in the Dhaka Stock Exchange on Tuesday fell by 4.86 percent. On the day, the closing rate of the company’s share was Tk89.90. In the last one year, the highest price of the company’s share was Tk141 and the lowest Tk78.50.