2024-08-14 14:44:19
DSE Brokers Association of Bangladesh (DBA) has made 30 demands for the sustainable and practical development of the capital market, including the restructuring of the Bangladesh Securities and Exchange Commission (BSEC), Dhaka and Chittagong Stock Exchange (DSE-CSE).
DSE Brokers Association of Bangladesh (DBA) President Saiful Islam made this demand at a press conference on ‘Current and Future Action Plans of Capital Market’ at a hotel in the capital on Monday (August 12).
He said that all the good governance and institutional structure of DSE has been completely destroyed for the last 14 years to protect the personal interests of a few in BSEC. Even, the implementation of the demutualization act has not followed proper rules on the issue of existing treks. In this case unethical pressure is applied from BSEC. Meanwhile, the chairman of DSE interfered unduly with the management without the decision of the board. So we demand restructuring of BSEC, DSE and CSE. Dr. for about 14 years from 2011 to 2024. M. Khairul Hossain and Professor Shibli Rubaiyat-ul-Islam served as BSEC chairman. Both of them came from the university teaching profession and occupied this position. Their unprofessional and unethical activities during this long time did not improve the market, rather the confidence of the investors reached rock bottom. The amount of corruption and irregularities that have been resorted to in the name of IPO in the last 14 years is very alarming. Unsuitable, weak, substandard, insolvent companies are listed in the market through IPO.
The DBA president said, a strange rule called ‘floor price’ has been imposed in our market. This ‘floor price’ hinders the buying and selling of shares and disrupts normal market transactions and investment. The floor price of share price is an unreasonable and harmful rule that interferes with the freedom of investors. Due to this rule, a large part of domestic and foreign investors turn away from our market. Later, when the ‘floor price’ was removed, the market improved for a while, but the re-imposition of the floor price halted the normal movement of the market and shattered investor confidence.
The demands of DBA are-
1. All corrupt officials should be removed from the regulatory body BSEC immediately.
2. An investigation committee should be formed with experienced and honest people to uncover all the irregularities and corruption of the past two commissions. If the investigation finds evidence of betrayal of the responsibility assigned by the state and corruption-irregularity, they should be brought under the law for appropriate punishment.
3. The regulatory body BSEC must be restructured by appointing honest, strong minded people who can prevent injustice under any pressure and experienced in the capital market and country’s economy as chairman and commissioner. In this case, no appointment can be made on political grounds. For this, a similar ‘search committee’ should be formed like Bangladesh Bank and provision should be made for the appointment of chairman and commissioner of BSEC and chairman and director of stock exchange.
4. Dr. Various disciplinary measures have been taken against some honest and responsible officers of BSEC for raising questions about the corruption-irregularities and reckless activities of Khairul and Shibli Commissions and refusing to be accomplices in misdeeds or demotions. All unfair disciplinary measures taken against them should be withdrawn immediately and they should be posted in appropriate departments according to their skills and qualifications.
5. BSEC Commission; In other words, the executive department should be separated from the commission by giving maximum power to the commission consisting of chairman and commissioners.
6. Competent and honest officials should be appointed to important posts according to their experience in BSEC and Stock Exchange.
7. All the officers including executive officers and directors of the BSEC executive department should be assigned responsibilities with separate powers. The officers of the executive department shall conduct all activities as per the rules and regulations of BSEC. The chairman of the commission or the commissioners cannot interfere in the normal functioning of the executive department.
8. Similarly, the boards of stock exchanges, CDBL and CCBL of the country should be restructured.
9. The past two commissions have enacted all the laws and rules that are against the interests of the stock market and investors, they should be repealed or amended and a practical law should be formulated. For this, all the existing laws and regulations should be reviewed and revised.
10. For the sake of the development of the stock market, an effective and active advisory council should be formed consisting of renowned economists, chartered accountants, cost and management accountants, academicians, responsible and competent officials of all regulatory agencies of the government including Bangladesh Bank, NBR and journalists, and other appropriate professionals. The Advisory Council will meet every month and will monitor the overall activities of the Commission and give suitable suggestions. The council will provide regular advice to the regulatory body in times of crisis or market development.
11. Stock market ups and downs are a normal phenomenon. It should be ensured that there is no direct intervention in the market by imposing floor prices or regulating circuit breakers even if there is a big fall in future prices.
12. On what basis the new trek licenses were given by the previous commission, whether there were any irregularities or financial transactions, it should be investigated.
13. In the name of foreign investment road show, there should be an investigation to uncover how the country’s money was wasted, embezzled and valuable foreign exchange was smuggled.
14. In the appointment of independent directors in listed companies, an independent director panel should be formed by specifying who is capable of performing duties as an independent director in any type of company, including experts in economics, business, financial accounting, law; Which will be updated regularly. Listed companies have to elect independent directors on the basis of dual selection of suitable persons from this panel. For this, instructions should be issued if necessary.
15. Appropriate amendments should be made to the IPO rules to bring transparency in the IPO, rights issue process. In this case independent and independent evaluation and decision making system of stock exchange should be kept.
16. Even after approval of the IPO, there should be a mechanism to cancel the IPO of the company and the stock exchange should empower the stock exchange to exercise its rational rights, whether or not a company is listed on the stock exchange.
17. The stock exchange should be empowered to independently investigate and inspect whether the listed companies are running real operations or not.
18. Stock exchanges should be empowered to suspend trading or delist listed companies in case of serious violations of listing laws. According to the listing regulations, absolute power to take action in respect of listed companies should be vested in the stock exchange.
19. Close companies should be delisted immediately or take alternative appropriate measures. In any case, the shares of closed companies cannot be traded in the stock market.
20. Stock exchanges will independently conduct surveillance to detect share manipulation in the secondary stock market. In this case, if there is evidence of manipulation, BSEC should take action against those responsible as soon as possible, taking into account the recommendations of the stock exchange, and cooperate in maintaining the order of the market.
21. If there is evidence of manipulation, criminal cases should be initiated considering the magnitude of the manipulation, the responsibility of the individual or organization, rather than a nominal or only financial penalty.
22. Apart from the existing surveillance system to detect share manipulation, the market monitoring and intelligence department should be strengthened with appropriate and adequate personnel.
23. The last two commissions have destroyed the mutual fund sector by handing it over to dishonest and insolvent individuals. Investigations should be conducted against the destroyers of this sector to ensure appropriate punishment and initiatives should be taken to hand over the management of the funds to real professional fund managers to regain the confidence of the investors.
24. Journalists should not be hindered in gathering information. Under no circumstances shall any impediment be placed on their commission or entry into the Stock Exchange.
25. If a report containing specific allegations against any person or institution is published or disseminated in the media, the matter should be investigated and action taken. In this regard, BSEC or DSE should make a public statement stating the actual facts and the action taken against the responsible person or institution if the report is true.
26. In the interest of accountability, BSEC and stock exchanges should organize public hearings every month to ensure public participation.
27. Unfair fees imposed on all market intermediaries including brokers should be reduced.
28. After this commission came, every broker increased the member’s various charges, fees manifold without any prior discussion. But this time the income of brokers did not increase. On the contrary, many offices and branch offices have been closed due to loss of capital in the last four years. As we have observed, the law has narrowed the income stream of brokers by making small sources of income for brokers like small interest from CCA. These unfair fees and measures must be withdrawn.
29. A legal power called 2CC has been given to act on behalf of investors. Regrettably, the last two commissions have arbitrarily misused the 2CC to facilitate vested interests and those involved in market manipulation. We demand immediate accountability for implementation of 2CC.
30. We demand immediate structural changes to the margin rules taking into account the overall and investment risk management.