Confirms government body ICB and BRAC Bank
Staff Correspondent: In a significant development for the country’s mutual fund industry, government custodian Investment Corporation of Bangladesh (ICB) and leading private-sector bank BRAC Bank have confirmed that the investment assets under RACE Asset Management’s care are 100% intact — dispelling recent doubts and concerns over asset safety.
ICB, which acts as the trustee and custodian of six of RACE's mutual funds — including EBL1STMF, TBL1STMF, 1STJANATAMF, IFIC1STMF, FIRST BANGLADESH FIXED INCOME FUND, and EXIM1STMF — revealed in its audit report dated 31 March 2025 that the entirety of the Tk 1,278.37 crore in capital market investments had been verified and accounted for.
Similarly, BRAC Bank, custodian of another four RACE-managed funds — 1STPopularlifeMF, PHP1STMF, ABBANK 1STMF, and EBLNRBMF — confirmed the intact status of Tk 718.84 crore under its oversight. The combined figure of Tk 1,997.21 crore, representing 10 of the country’s largest mutual funds, was verified without any gaps or irregularities.
“This is undoubtedly encouraging news for the mutual fund sector,” said Professor Mazharul Islam, Regulatory Affairs Advisor at the Association of Asset Management Companies and Mutual Funds (AAMCMF). “It shows the strength of the tripartite system — the fund manager, the custodian, and the trustee — in protecting investors' money. This confirmation should greatly restore public confidence.”
Professor Islam added that the Bangladesh Securities and Exchange Commission (BSEC) had previously pledged to conclude its years-long investigations into these funds if their assets were verified as intact. “We hope the regulator will honour that commitment,” he noted.
An experienced CEO from a rival asset management company shared, under condition of anonymity, that a senior BSEC official had earlier acknowledged: “If the assets are intact, it is the clearest proof that the fund manager has followed securities law. There would be no reason to interfere.”
According to industry voices, however, lingering damage to the sector has not come from fund managers, but rather from burdensome regulatory interventions. Two of the most harmful, they say, have been the price floor policy and excessive provisioning mandates introduced under former BSEC Chairman Shibli Rubayat, now facing charges of corruption and abuse of power.
“Mutual funds have suffered badly due to regulatory overreach,” lamented Ahsan Habib, a long-term investor. “We used to get decent dividends. Now, not only has the market stagnated, but regulators are making it harder for fund managers to operate. Let them do their job — they’re the ones creating value for investors.”
Mamunur Rashid, Head of Compliance at RACE, stressed that the entire Tk 1,997.21 crore in investment assets are secure and regularly audited. “There’s been no unlawful diversion of funds,” he said. “We maintain the highest asset quality — 100% of our listed portfolio is in top-grade ‘A’ category stocks like RENATA, GP, and BATBC, and our non-listed investments all have BSEC approval.”
In a previous press statement, RACE accused a “vested group” of attempting to destabilise the company through false rumours and misleading narratives. “This campaign aims to damage our 20-year legacy and potentially force a takeover,” the release alleged. “We are speaking up to protect both our reputation and the mutual fund industry’s credibility.”
Since its inception, RACE-managed funds have distributed over Tk 1,800 crore to investors, including more than Tk 600 crore in cash dividends over the past three years alone. This performance makes RACE the largest dividend contributor in the sector — a claim now further reinforced by the clean asset audit.
As mutual fund investors and professionals alike call for a more balanced regulatory approach, the message is clear: confidence can only return to the industry when competence is allowed to lead, and interference gives way to trust.
