Depository participants come under CDBL lens

Depository participants have come under the monitoring system of the Central Depository Bangladesh Ltd (CDBL), which operates the central depository system for electronic share transaction in the stock exchanges.

The CDBL will visit the depository participants every month to check whether they are complying with rules and regulations properly.

The Bangladesh Securities and Exchange Commission took the decision recently, according to a posting on the Dhaka Stock Exchange website yesterday.

“Based on the visits, the CDBL will submit a summary report on measures taken by it to the BSEC within the first 10 days of the following month,” according to the posting.

The CDBL's services are extended through its agents called depository participants. A depository participant is the link between investors and the CDBL. An investor who opens a BO (beneficiary owner's) account with a depository participant can utilise the services offered by the CDBL. Saifur Rahman, spokesman of the BSEC, said usually the regulator inspects stockbrokers, not the depository participants.

“But, there have been allegations that the depository participants are not complying with depository rules properly,” he said.

As the primary regulator, it is the responsibility of the CDBL to inspect the depository participants on a regular basis, said Rahman, also an executive director of the BSEC.

Presently, there are 464 depository participants registered with the CDBL.