Send non-listed insurers to stock market
The securities regulator has requested the insurance watchdog to take steps to list non-listed insurers and make them invest in order to give a boost to the stock market.
Yesterday, the Bangladesh Securities and Exchange Commission (BSEC) sent a letter to the Insurance Development and Regulatory Authority (IDRA) to this effect.
In 2020, the commission exempted 26 insurers, which have less than Tk 30 crore in paid-up capital, from going public.
The companies were, however, ordered to invest at least 20 per cent of their equity in the market if they don't want to get listed.
"It has been observed that the aforementioned insurance companies have not taken any initiative so far to file applications for initial public offering and are not investing at least 20 per cent of the equity of each company in any stock exchange of Bangladesh," the letter said.
Hence, the BSEC requested the IDRA to take necessary steps to encourage the insurers to get listed and invest the fund.
With a view to giving a boost to the capital market, the BSEC has taken a raft of measures to increase the participation of institutional investors. The letter was a part of the steps, according to a top official of the commission.
The capital market in Bangladesh is dominated by retail investors, who account for around 80 per cent of the investor base.
It is expected that institutional investors will dominate activities instead of retail investors to bolster the capital market, the letter said.
"Insurance companies are expected to act as institutional investors and come up with innovative ideas for the sake of their business and capital market development."
Comments