Capital market needs better way of operation
The present chaotic and polluted path of operating the capital market needs to be improved, Finance Minister AMA Muhith said yesterday.
“But, I'm hopeful that we'll see the improvement as we've taken some reform initiatives to implement those fully. We will demutualise the bourses soon,†he said at the dividend handover ceremony of Investment Corporation of Bangladesh (ICB) at the finance ministry.
ICB Chairman SM Mahfuzur Rahman handed over a cheque for Tk 45.56 crore to Muhith, including Tk 22.78 crore as cash dividend and Tk 22.78 crore as dividend warrant for 2011-12.
The minister said the present government from its very beginning has been trying to energise the capital market and also got results to some extent.
“We might not have got results to such extent of our targets set earlier, but surely we've got something,†Muhith said, hoping that the newly introduced price indices at Dhaka Stock Exchange would help remove the lack of trust among the investors.
Based on the free-float methodology used by the world's major indices, the DSE launched two price indices: DSEX and DS30 that were designed by Standard and Poor's, one of the world's leading credit-rating agencies.
Muhith also lauded the recent initiative from the Federation of the Bangladesh Chambers of Commerce of Industry to rejuvenate the capital market.
Demutualisation must be done in the proper sense of the term, as it is a very important instrument for the market, he said.
The minister also emphasised the need for simplifying the procedures and management of the EEF fund of Bangladesh Bank so that small investors could avail themselves of these easily.
Asked about the ICB's proposal to allow the investment of undeclared money in the Bangladesh Fund without any fine, Muhith said undisclosed money could remain. “But, if you want to invest it, give fine and that should be the practice.â€
“Otherwise, it would be injustice to those who have announced their undisclosed money.â€
Muhith said the system for investing undisclosed money with fine will continue, no matter who will come in this finance ministry in the future.
He said the government usually makes investment in many sectors, but does not get significant returns. Muhith also said it is a misperception that it is possible to influence the market with government investment.
Acting Secretary of the Bank and Financial Institution Divi-
sion Amalendu Mukherjee and ICB Managing Director M Fayequzzaman were also present.
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