Establishing share market as main source of funds for industrialization stressed

Publish: 8:48 PM, September 12, 2020 | Update: 8:48:PM, September 12, 2020

DHAKA,  – Stock market stakeholders today said that transparency, accountability and good corporate governance should be ensured to establish the concept that the capital market is the main source of funds for industrialization.

They also said that enlistment of good quality companies, product diversification such as creation of bond market and same database in the financial statements of all stakeholders should be there for the transparency of listed companies.

They made these remarks at a webinar, titled “Towards a sustainable capital market: The drivers of growth”, which was jointly organized by the Capital Market Journalists’ Forum (CMJF) and Bangladesh Merchant Bankers Association (BMBA).

CMJF General Secretary Munir Hussain moderated the webinar while the Bangladesh Securities and Exchange Commission (BSEC) Chairman Professor Shibli Rubayat-Ul-Islam was the chief guest.

Eunusur Rahman, Chairman of Dhaka Stock Exchange (DSE), Asif Ibrahim Chairman of Chittagong Stock Exchange (CSE), Sharif Anwar Hossain President of DSE Brokers Association (DBA) and Dr. Hasan Imam, and President of AMC Association, also joined the webinar as special guests.

Md Moniruzzaman, the managing director of IDLC Investments Limited, presented the keynote paper.

BSEC Chairman Professor Shibli Rubayat-Ul-Islam said, the recent steps taken by the new commission aimed to protect retail investors’ rights and regain their confidence.

“We’ve expedited the process for enforcing actions against non-compliant entities, next-level automation of the market infrastructure for ensuring efficiency; as well as approving new debt securities,” he said.

Shibli also said that they are trying to increase financing through the capital market. “We will establish the concept that the capital market is the main source of funds for industrialization.”

The BSEC Chairman said general investors suffer when bad companies with questionable financial fundamentals enter the market. “The commission will not allow anything that hurts the investors,” he said.

Shibli said the securities regulator has no scope for allowing a director at a listed company if he or she does not hold minimum 2 percent shares.

The BSEC Chairman also said some directors are facing pressure to hold 2 percent shares within the stipulated period. “That is why we are giving them some extra time on a case-to-case basis.“

BMBA President Md Sayadur Rahman, in his welcome address, said that the stock market is much better now compared to the past few years. “Transparency of listed companies is an important issue. For this, the regulatory body should take the initiative to create a central database of financial reports for all stakeholders.”

He said, “We believe that the stock market regulator took initiatives to list good companies in the capital market that will continue for the investors.”

CMJF president Hasan Imam Rubel said investors are still going to in the money market as there is no dynamic capital market. Due to the lack of good governance in the money market, bad loans are increasing. He also called upon the current commission to form a vibrant capital market.