BSEC approves 'alternative investment' draft rules

It also okays Tk 5.b bond by AB Bank


FE Report | Published: March 06, 2019 10:32:44 | Updated: March 07, 2019 19:05:33


The securities regulator has approved the Bangladesh Securities and Exchange Commission (Alternative Investment) draft Rules, 2016 after some amendment.

The BSEC move will help promote venture financing and equity investment facilities for non-listed local firms, sources concerned said.

The approval came on Tuesday in a commission meeting.

BSEC said (Alternative Investment) draft Rules, 2016 will be published soon in the daily news papers seeking for public opinion.

In 2015, the BSEC formulated alternative investment rules to promote venture financing and equity investment facilities for non-listed local firms.

The securities regulator on Tuesday also approved a fully redeemable non-convertible floating rate subordinated bond of Tk 5.0 billion in favour of AB Bank Limited.

The BSEC Chairman M Khairul Hossain presided over the meeting, said a BSEC statement.

The characteristic of the bond is non-convertible, fully redeemable, unsecured, unlisted subordinated bond.

The purpose of the bond issue is to strengthen the capital base (Tier-2) of the bank. The tenure of the AB Bank bonds will be seven years. Per unit price of the bond will be Tk 10 million.

The units will be sold to institutional investors and eligible investors, including banks, financial institutions, insurance companies, corporate bodies, asset management companies, mutual funds and high net-worth individuals through private placements.

MTB Capital Limited will act as the Trustee and RSA Capital Limited is the lead arranger for the Bond.

The proceeds of the Bond will strengthen the bank's capital base and meet its capital requirement through private placement, company officials said.

Each share of the AB Bank, which was listed on the Dhaka Stock Exchange in 1983, closed at Tk 11.90 on Tuesday.

The bank's paid-up capital is Tk 7.58 billion, authorised capital is Tk 15 billion and the total number of securities is 758.13 million.

The sponsor-directors own 36.47 per cent stake in the bank, while the government owns 0.57 per cent, institutional investors own 24.67 per cent, foreigners 1.15 per cent and the general public 37.14 per cent as of January 31, 2109.

The AB Bank failed to pay dividend for the year ended on December 31, 2017. Accordingly, it is being traded in the 'Z' category.

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