DSE points out 4 causes

DHAKA: Dhaka Stock Exchange (DSE) has pointed out the 4 causes behind recent debacle in turnover value.  

After holding series meeting with Merchant Bank Association, top brokers and stock dealers, they have found a way to enhance turnover and submitted those as a proposal to the Bangladesh Securities and Exchange Commission (BSEC) and Bangladesh Bank on Tuesday.

The proposal says that DSE met with related concern institutions on January 13, 14 and 20. After a fruitful discussion with the participants various issues came up regarding the current market situation. Based on the discussion DSE point out 4 issues behind worsen market and also proposed solution of those.

DSE President Rakibur Rahman said to banglanews, “We found out these problems in the meeting. We will also meet further with bank association and stock brokers on Monday next for talking on market situation. Later we will hold a meeting with Related Parliamentary Standing Committee on Finance on 12 February.”

According proposals, the 4 causes are- Stuck Margin Loan, Restriction On Bank Loan for Members of the Exchange, Provisioning of negative equity and Investment of Bank Companies.

In the proposal said, a total outstanding margin loan amount provided by the stock brokers, merchant bankers and financial institutions is now approximately Tk 15,000 crore.

Due to significant decline in market, price of listed securities approximate 25 per cent of the margin loan amount is not recoverable during current situation. In this case rule 3(5) of margin rules, 1999 may be considered.

To increase stock dealers financial solvency for buy `A’ and `B’ categories shares Bangladesh Bank may raise the limit of loan up to Tk 20 crore from existing Tk 1 crore.

BDST: 1748 HRS, 24 JAN, 2013
JNA/ Edited by: Abul Kalam Azad, Newsroom Editor/ M. Mahbub Alam, Asst Output Editor