SEC Quarterly Review 

Jan - March 2002 

CAPITAL MARKET NEWS

                                                                    The Commission

Lock- in on private placement, etc.: With a view to encouraging the small investors in primary market, the Securities and Exchange Commission (SEC) has decided to waive the lock-in on private placement shares for a company coming with a minimum Tk. Five crore paid-up capital and if it offers at least 60 percent of the capital to general public for subscription through initial public offering (IPO). SEC has also decided to bar companies from raising funds if the name of any of their sponsor or director or sister organization appears on the list of Credit Information Bureau (CIB) report of the central bank. SEC has also decided to change criteria of Z category companies, enabling them to upgrade their status by simply declaring dividend on the current year’s performance and holding AGM regularly.
Bonus share: SEC has decided to absolve the listed companies to obtain SEC permission prior to offering bonus shares.
Trustee of BRAC Bond: The Securities and Exchange Commission (SEC) has decided in principle to allow AIMS of Bangladesh Ltd. to be a trustee of  Special Vehicle Purpose (SVP) Trust of BRAC Securitised  Bond. Its permission is subject to the AIM’s obtaining no objection certificate (NOC) from the trustees of AIMS First Guaranteed Mutual Fund.
Delegation of ICMAB: A delegation of the Institute of Cost and Management Accountants of Bangladesh (ICMAB) headed by its president Mr. Rafiq Ahmad met Mr. Manir Uddin Ahmad, Chairman, Securities and Exchange Commission (SEC) and the members and executives of SEC. They discussed about the role of cost and management accountants in the capital market.
1996 Share Scam: The Securities and Exchange Commission (SEC) has formed two separate committees comprising the officers of the regulatory body to carry out  detailed investigation about the unfinished task of the previous committee on 1996 share scam. SEC member Mr. K. Iftikhar Ahmed has been made convener of the two committees.
Frequent changes in grades of companies: The Securities and Exchange Commission (SEC) has constituted an inquiry committee to investigate the frequent changes in the categories of the listed companies at the stock exchanges. SEC apprehends some malpractices which could result in frequent changes in grades which forces rise or fall in the share prices at the stock exchanges on declaration of minimum dividend or no dividend at all by the companies.
SEC approves OTC trading on DSE and CSE: The Securities and Exchange Commission (SEC) has given approval to the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) for launching over the counter (OTC) trading.

DSE

Direct Listing of shares: The first ever direct listing of shares of Square Textile Ltd. landed on the DSE trading with a big bang on January 24, 2002 with the price hitting Tk. 29.30 against its face value of Tk. 10 per share. With the beginning of trade, the buyers responded to the bid of Tk. 18.00 sale offer which later rose to Tk. 29.30.
Trading of preferential shares begin on DSE: For the first time in Bangladesh, trading of preferred shares promising 15 percent   guaranteed cumulative dividend to investors began on the DSE. The company, Beach Hatchery Ltd., has raised Tk. 8 crore from the market; Tk. 5 crore in pre-IPO (Initial Public Offering) and Tk. 3 crore through IPO.
Election: Mr. Ahmed Iqbal Hasan has been elected uncontested as the Chairman of the Dhaka Stock Exchange Ltd. for the year 2002. Mr. Abdul Haque and Mr. Khwaja Ghulam Rasul have been elected uncontested as the Senior Vice- Chairman and Vice-Chairman respectively of the bourse for the year 2002.
Annual General Meeting: The 40th Annual General Meeting of Dhaka Stock Exchange Ltd. was held on 28 March, 2002. A large number of members attended the meeting  which was presided over by the outgoing Chairman Mr. Md. Shahiq Khan. The members present unanimously approved all the agenda of the meeting, including the audited accounts and balance sheet for the year 2000-2001 of the exchange.

CSE

CDBL’s presentation: Central Depository Bangladesh Ltd.(CDBL) and its system provider CMC India Ltd. presented a demonstration on Business Rules Specification on 13 February, 2002 to the CSE Members at the CSE conference hall, Chittagong.
Internet trading: The Chittagong Stock Exchange (CSE) is all set to launch stock trading on the Internet. With the launching of Internet trading the country will enter the cross border trading as the bourse will facilitate trading from anywhere in the world.