BSEC okays bond issuance by intermediaries to boost stock market

The Bangladesh Securities and Exchange Commission (BSEC) has made four decisions to increase liquidity flow into the market.

Providing bond issuing (debt securities) opportunities to the broker houses and merchant bankers is seen as a crucial one of the four decisions, officials said.

The commission made the decision in an emergency meeting with representatives of stock market intermediaries on Tuesday.

BSEC Commissioner Prof Sheikh Samsuddin Ahmed presided over the meeting attended by the representatives of top brokers and merchant banks.

BSEC Executive Director and Spokesperson Mohammad Rezaul Karim said four issues were discussed to increase liquidity in the stock market.

“One of these is that broker houses and merchant banks will be given the opportunity to issue debt securities (bonds) which will enable the institutions to invest directly and lend margins to the customers,” he said.

The meeting also discussed the need to invest money in the Capital Market Stabilization Fund, he said.

The commission would take a quick decision on how to apply for the stabilisation fund in the debt securities of the intermediary institution, including speedy investment.

Rezaul Karim said the government has given a chance to the affected investors to use the Tk 900 crore revolving fund, for a period of five years. Some of this money has been used. Work will be done on how to invest the rest of the money rapidly.

The investment of special funds of Tk 200 crore by the banks was also discussed. Officials said banks must upgrade their limit whose contribution is less than Tk 200 crore as soon as possible.

How to bring the banks to invest in the stock market under the current situation will be discussed in the next coordination meeting with Bangladesh Bank.

“Everyone present at the meeting agreed that there was nothing to panic about the last few days’ trading in the stock market,” he said.

This has happened due to taking out profit. Everyone hopes that the stock market will turn around very soon, officials said.