Regulator moves to settle share, cash transactions from same place
Bangladesh Securities and Exchange Commission yesterday approved a draft act on setting up a clearing and settlement company to ensure smooth settlement of share and cash transactions from the same place.
Before finalisation, the draft act will be sent to other market stakeholders, including Dhaka and Chittagong stock exchanges, for their opinion.
The stockmarket regulator took the decisions at a meeting with its Chairman M Khariul Hossain in the chair, according to a statement.
A clearing company is a financial institution that provides clearing and settlement services for financial, commodities derivatives and securities transactions.
Capital market-related diversified products, including derivatives, futures and options, can also be introduced in the capital market once the clearing company is in place.
Presently, the share transactions are settled through the Central Depository of Bangladesh, which operates the central depository system for electronic share transaction.
On the other hand, the cash transactions are settled through the banking channel.
Two years earlier, the Dhaka and Chittagong bourses submitted a proposal to the BSEC to set up a clearing company jointly for smooth settlement of share and cash transactions from a single place.
The Asian Development Bank, as part of its Bangladesh capital market development programme, has long been advising the government and the stockmarket regulator to set up a separate clearing corporation.
At yesterday's meeting, the BSEC also fined the directors of Progressive Life Insurance Company Tk 1 each, as the listed company failed to submit its audited annual report for 2013, half yearly and third quarter's financial statements for 2014 to the commission.
Comments