ICB, its subsidiaries to waive 100pc interest on margin loans

Investment Corporation of Bangladesh (ICB) and its two subsidiaries will waive 100 per cent interest on the margin accounts of the 'affected' investors.

The subsidiaries are ICB Capital Management Limited (ICML) and ICB Securities Trading Company Limited (ISTCL).

The investors, who incurred substantial losses after the 2010-11 stock market debacles, would be entitled to avail of the facility.

Kazi Sanaul Hoq, managing director of ICB, said the decision was taken considering the ongoing market situation. The ICB invited applications by June 28, 2018.

"Our clients will be allowed to avail of the facility after making a down payment of 5 per cent," he said.

According to ICB managing director, around Tk 5.0 billion will be waived against 13,000 accounts managed by the three companies, including the ICB.

The interest to be waived has been calculated for a period from January 1, 2011 to March 31, 2018.

Around 5,000 accounts managed by ICB will come under the coverage of the waiver facility.

And, the interest calculated against around 6,000 accounts managed by ICML would also be waived if the clients submit applications, said the officials.

They said the investors of some 450 accounts, managed by ISTCL, would be entitled to the interest waiver facility declared by the ICB.

An official concerned at the ISTCL said the objective of waiving 100 per cent interest is to make margin accounts alive for transaction of shares.

"We want to help our clients so that they can conduct share transactions availing of the facility announced by the ICB and its subsidiaries," said the official.

After 2010-11 stock market debacles, the central bank disbursed Tk 9.0 billion to the ICB through three equal installments for reducing the sufferings of the affected investors.

"The ICB has also disbursed the fund taken under the capital market refinancing scheme against the accounts of the affected investors," said the managing director of the ICB.

Out of Tk 9.0 billion, some Tk 2.57 billion has not been disbursed against the portfolios of the affected investors till December 31, 2017.

Later, the securities regulator extended the timeframe to apply for the loan facility till March 31, 2018.

To ensure complete utilisation of the fund, the concerned committee has eased some of the conditions.

As a result, the borrowers who already availed the loan facility once will also be allowed to apply for loans for the second time.

The government had also reduced the interest rate on loans to 6.0 per cent from 7.5 per cent under the refinancing scheme.

[email protected]