The Bangladesh Securities and Exchange Commission (BSEC) will discuss three issues with the government to provide short, medium and long-term policy support for the development of the capital market. These are – investor benefits, solving problems of market intermediaries and increasing market depth. A series of decisions will be taken regarding the capital market in consultation with the government. The scope of this support will be for individual investors, institutional investors, high net worth investors and foreign investors.
BSEC chairman Khandkar Rashed Maqsood said these things in an exchange meeting with journalists at Agargaon Securities Commission building in the capital on Tuesday (October 29).
Khandkar Rased Maqsud said in the meeting that the financial advisor has returned to the country. Within this week, a decision will be taken regarding the policy support for the development of the stock market on the basis of discussions with the advisors and related parties. Some of which will be implementable in the short term, while others will be implemented in the medium and long term. The policy measures that have been taken include, taking necessary measures to increase the supply of liquidity in the market, assistance in providing funds to increase the investment capacity of the state-owned investment corporation Investment Corporation of Bangladesh (ICB), taking necessary measures to use the money collected by BSEC through fines for the protection of investors, Reforming the IPO law and providing tax incentives to bring public and private good and profitable companies to the market faster, reducing the settlement time in the stock market to one day, finally settling the amount of unpaid accumulated negative debt (negative equity) in the lending institutions, high net worth individuals. Reduction of capital gains tax rate to encourage investment, determination to introduce share buyback system, no future imposition of floor price on foreign investment growth, ensuring good governance and due observance of law.
The chairman of BSEC said that there has been a big fall in the share market in recent times due to several reasons. In this situation, the development of the market will be discussed with the government keeping three things in mind. These are investor benefits, solving problems of
He said, in the last two months, we have had many discussions with various parties related to the market. The commission is working to solve the obstacles that have come up in the development of the market in these discussions. All in all, we assure investors that they will get good things in the future. At present, the work of reforms in various aspects of the state is going on. As a part of that, various reforms will be implemented in the capital market in the short, medium and long term, which will benefit the investors. The current commission is committed to building a prosperous capital market by ensuring good governance and accountability.
Khandaker Rashed Maqsood also said that many investors have left the market due to the imposition of a minimum price level or floor price on share prices for a long time. Especially foreign investors have turned away from the stock market of Bangladesh. Again due to high tax rates wealthy people have lost interest in investing. On the other hand, institutional investors are now more interested in investing in treasury bill-bonds due to higher interest rates. Therefore, various steps will be taken to increase institutional investors in the stock market. For this purpose, he also informed about the plan to make the mutual fund sector more active.
After speaking to the journalists, the commission said that the commission will take effective steps to solve the problem of marginal debt and negative equity in the market. The commission does not want to interfere in day-to-day market ups and downs. However, law enforcement efforts will be made to restore order in the market. The commission also said that they have already met with several leading entrepreneurs of the country to bring good companies to the market. The commission is working to bring good multinational, public and private companies to the market. Besides, emphasis is being placed on digitization to facilitate the information delivery process, the journalists were informed.
During the exchange of views, it was informed by the commission that no action has been taken despite the investigation against various irregularities during the past commissions. Due to this, 276 investigations remain incomplete. It is also reported that the Commission is actively considering reducing the transaction settlement time to one day to improve the liquidity situation of the stock market.
(function(d, s, id) {
var js, fjs = d.getElementsByTagName(s)[0];
if (d.getElementById(id)) return;
js = d.createElement(s); js.id = id;
js.src = ”
fjs.parentNode.insertBefore(js, fjs);
}(document, ‘script’, ‘facebook-jssdk’));
Time.news Editor: Good day, everyone! Today, we have the privilege of speaking with Khandkar Rashed Maqsood, Chairman of the Bangladesh Securities and Exchange Commission (BSEC). We’ll delve into the recent discussions undertaken by BSEC regarding the development of the capital market. Welcome, Mr. Maqsood!
Khandkar Rashed Maqsood: Thank you for having me. I’m glad to be here.
Editor: Let’s dive right into it. BSEC has recently mentioned plans for short, medium, and long-term policy support for the capital market. Can you elaborate on what these policies entail?
Maqsood: Certainly! Our upcoming discussions with the government will focus on three key aspects: enhancing investor benefits, addressing issues faced by market intermediaries, and increasing market depth. These discussions aim to devise policies that benefit individual investors, institutional investors, high-net-worth individuals, and foreign investors alike.
Editor: It sounds like a comprehensive approach. But why is it particularly important to address investor benefits at this time?
Maqsood: The urgency arises from the recent downturn in the share market, which has caused many investors to lose confidence. We want to reassure them by implementing changes that not only protect their interests but also make the market more attractive. We aim to create an environment where investors feel secure and valued.
Editor: That makes sense. You mentioned reforms related to liquidity and how you’re planning to assist the Investment Corporation of Bangladesh (ICB). Can you explain how these plans will work?
Maqsood: Yes, increasing liquidity is crucial. We aim to facilitate funds for the ICB to boost their investment capacity. This should help in enhancing the liquidity in the market, thus encouraging more trading and investment activity. We are also considering utilizing fines collected by BSEC to protect investors.
Editor: Interesting approach. I’ve also noticed that many investors are concerned about the high capital gains tax and the floor price on share prices which have discouraged foreign investment. How does BSEC plan to tackle these challenges?
Maqsood: You’re absolutely right. High tax rates have been a deterrent for wealthy individuals, and the floor price has made the market unattractive for foreign investors. One of our proposals includes reducing the capital gains tax rate to stimulate investment. Additionally, we are looking at lifting the floor price on foreign investments to make the market more appealing.
Editor: With all these reforms, what do you think will be the expected timeline for seeing real changes in the market?
Maqsood: Some changes will be implemented in the short term—like increasing liquidity and adjusting tax structures—while others, particularly structural reforms and new regulatory frameworks, will take longer to roll out. We’re working diligently with our advisors, and we hope to make significant progress within weeks.
Editor: It sounds like BSEC is really committed to improving the capital market. Can you share how you plan to engage with institutional investors moving forward?
Maqsood: Absolutely. Institutional investors are key players in the market. We plan to stimulate their participation by making the mutual fund sector more active and establishing favorable conditions for institutional investment. This may include better incentives and ensuring that the market is an attractive place for them to allocate their funds.
Editor: That’s great to hear. Lastly, what message would you like to convey to current and potential investors amid these upcoming changes?
Maqsood: I want to assure investors that we are committed to building a prosperous capital market characterized by good governance and transparency. We are listening to their concerns, and our objective is to establish a reliable and vibrant market where investors can feel secure.
Editor: Thank you so much for your insights today, Mr. Maqsood. It’s clear that BSEC is taking important steps to enhance the capital market in Bangladesh.
Maqsood: Thank you for the opportunity to share our plans. I look forward to seeing our market thrive!
Editor: And thank you to our audience for joining us today. Stay tuned for more updates on the capital market developments in Bangladesh!