DSE to reduce trading settlement period
Backtracking on an earlier decision, the premier bourse has decided to reduce the trading settlement period by a day in line with a regulatory requirement.
Before that, Dhaka Stock Exchange needs to alter some of its clauses in the “Settlement of Stock Exchange Transactions Regulations, 1998”.
The bourse submitted a draft of the amendment to the Securities and Exchange Commission for approval on Sunday.
The new trading settlement period will be implemented after the publication of a gazette notification on the amendment, officials said.
"We never said that we won't implement the regulatory decision on reducing the trading settlement period by a day," said Shakil Rizvi, president of DSE.
"We will implement the new settlement period -- T+2 -- after a gazette notification," he added.
The T+2 means buyers will receive shares, and sellers will get money two days after a trade is made.
The amendment in the regulations is needed as the existing ones include the tra-ding settlement period at T+3, said Ahsanul Islam, senior vice-president of DSE.
"Without changing the T+3 settlement period to T+2, it will not be legally perfect to implement the new settlement period," Islam added.
Earlier, the DSE at a meeting on October 25 decided in principle that the regulatory decision to reduce the trading settlement period will not be implemented now, rather it will be implemented after the market situation is stabilised.
The Chittagong Stock Exchange also submitted a draft amendment on the settlement of the regulations for approval.
The stockmarket regulator on October 18 decided to reduce the stock trading settlement period by a day, in an attempt to in-crease the trading efficiency of the bourses.
The SEC also asked the stock exchanges to decide themselves when they will implement the new settlement period.
The market watchdog said the time reduction would increase the efficiency of the trading settlement.
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