The Bangladesh Securities and Exchange Commission (BSEC) plans to form an intelligence unit for the capital market to intensify monitoring of merchant banks, said BSEC Chairman M Khairul Hossain yesterday.
Merchant banks are supposed to bring new companies in the market but they are not doing it accordingly, he said while addressing a meeting with Capital Market Journalists Forum (CMJF) at the BSEC headquarters in the capital.
He said institutional investors were coming to the market just to earn money instead of properly performing their duties.
He warned that steps would be taken against such institutions which were not playing a role in listing new companies.
Hasan Imam Rubel, president of CMJF, led the journalists' team while BSEC commissioners Swapan Kumar Bala, Amzad Hossain and Khondoker Kamaluzzaman were present. At present 57 merchant banks are in operation and their main activities are issue and portfolio management and underwriting, said Khairul Hossain.
Many organisations could not perform issue management for which new companies were not getting listed in the market as expected, he said.
Merchant banks which could not list new companies will be asked to give explanations, said chairman.
He warned that their licence could be cancelled if their explanation was not found satisfactory to the authority.
He said the process of initial public offerings was now transparent and BSEC does not allow premium for any company.
If any company wants premium, it must go for book building method. As a result, there is no chance to manipulate share prices, he claimed.