Regulator moves to stop slide in stocks

The stock market regulator yesterday came up with a raft of decisions to halt the fall in share prices for over a month.

The move came a day after its meeting with the prime minister at her office over the matter.

The Bangladesh Securities and Exchange Commission (BSEC) revealed the decisions after a meeting with the Dhaka Stock Exchange (DSE), the Chittagong Stock Exchange (CSE), and merchant banks and brokerage associations at the capital’s BSEC.

As per the decisions, the general investors’ quota for initial public offering (IPO) shares has been increased by 10 percentage points and the lock-in period for sponsors and placement shareholders will be counted from the trading day of a stock instead of the day of the issuance of prospectus.

Also, a company will not need to take approval from the regulator to raise capital through pre-IPO shares, said Saifur Rahman, executive director and spokesman for the BSEC, while briefing the media after the meeting.

In order to declare bonus shares, a company will have to explain how it will spend the money, he said.

Through IPO, a company must raise a minimum Tk 50 crore in case of face value and Tk 100 crore in case of book building method, Saifur said.

“We hope investors’ confidence will return following these decisions,” said Minhaz Mannan Emon, a director of the DSE.

M Khairul Hossain, chairman of the commission, presided over the meeting, which was attended by all the commissioners of the BSEC, the chairman and managing director of the DSE, a director of the CSE, and heads of the associations of merchant banks and brokerage houses.

Dhaka stocks sank to a 27-month low yesterday, compelling aggrieved investors to stage a hunger strike in front of the Dhaka Stock Exchange building.

The DSEX, the benchmark index of the DSE, dropped 62.73 points to close at 5,175.46.

In the last one month, the bourse lost Tk 29,264 crore, or 7.10 percent, from its market capitalisation.