CCBL yet to begin operations for delayed appointment of directors

The Central Counterparty Bangladesh Limited (CCBL) has failed to commence its operation even five years after its incorporation for delayed appointment of independent directors.

The CCBL in a letter recently offered an explanation as to why it could not start working in 955 days. It said the formation of the board of directors alone had taken 535 days while the remaining days had been spent over matters linked to the Dhaka Stock Exchange (DSE).

The organisation had long waited for the appointment of independent directors by the Bangladesh Securities and Exchange Commission (BSEC). Its board must have seven independent directors.

There was a delay for 78 days because of the changes in the DSE-nominated directors at the CCBL. Another 95 days were spent presenting ideas to the newly-appointed directors, while 112 days were needed to finalise procurement decisions made by the DSE-nominated directors.

A further 17 days were gone as the board reviewed documents of the tendering process.

Then CCBL could not hold a board meeting in 118 days due to the absence of shareholder directors from the DSE, the Chittagong Stock Exchange, and the Central Depository Bangladesh Limited.

The CCBL is expected to modernise the infrastructure of Bangladesh's capital market by introducing derivative products and through advanced clearing and settlement systems.

Recently, the Dhaka Stock Exchange (DSE), one of CCBL's key stakeholders, brought the allegation of a lack of transparency against the CCBL and questioned its competence for its failure to begin operations.

The prime bourse also raised concerns over CCBL's move to procure software and IT equipment when it reached an advanced stage to launch its operations.

The CCBL, however, rejected DSE's request to suspend procurement activities, saying the request is legally invalid. The CCBL is an independent organisation, it said. To ensure independence of the CCBL, a majority of its directors are independent (seven out of thirteen).

Moreover, other shareholders, which jointly hold 55 per cent stake in the CCBL, have not raised any objection to its procurement move.

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