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ICB to get lion's portion of the fund

Capital market refinancing scheme


FE Report | Published: May 21, 2019 10:50:34 | Updated: May 22, 2019 10:55:26


The state-run Investment Corporation of Bangladesh (ICB) will get the lion's portion of the fund to be disbursed for the second time under the capital market refinancing scheme.

The other stakeholders of the capital market will also avail the fund facility on first come, first served basis.

The loan worth Tk 8.56 billion, which has been repaid under the capital market refinancing scheme, will further be disbursed to the stakeholders including the ICB as part of market supportive measure.

"The ICB is getting the major amount of the fund. The other stakeholders will also avail the facility on first served basis," said Mohammad Saifur Rahman, an executive director of the securities regulator.

In 2013, the ICB received Tk 9.0 billion from the central bank through three installments under the capital market refinancing scheme.

The government provided the fund to reduce the suffering of small investors affected during 2010-11 stock market debacle.

Of Tk 9.0 billion, Tk 8.56 billion, including interest, has so far been recovered by the concerned committee. The fund is yet to be deposited to the government's exchequer.

Following the recent declining trend of the capital market, the ICB urged the government to disburse the fund for the second time at a minimum rate of interest.

The corporation has sought the fund to provide 'instant' support to the capital market which recently has witnessed continuous correction amid lack of confidence.

Following the ICB's plea, the government has extended the tenure of the capital market refinancing scheme till December 31, 2022.

Initially, merchant banks and brokerage firms disbursed the funds against the portfolios of affected investors at an interest of 9.0 per cent.

Later, the interest rate was reduced following the plea of merchant banks and brokerage firms.

Finally, the borrowers received funds at an interest of 5.0 per cent and they disbursed the fund against investors' portfolios at an interest of 7.0 per cent.

mufazzal.fe@gmail.com

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