Make impartial policies to protect investors' interests

Capital market stakeholders have urged the securities regulator to avoid making policies that favour any vested interests or influential individuals, in order to protect the overall capital market and the interests of investors.

The call came at a view-exchange meeting organised by the Bangladesh Securities and Exchange Commission (BSEC) on Tuesday as part of its move to set a road map for the development of the capital market.

Representatives of the associations of merchant bankers, stock brokers and listed companies attended the meeting, with BSEC chairman Khondoker Rashed Maqsood in the chair.

Mazeda Khatun, president of the Bangladesh Merchant Bankers Association (BMBA), said that they have requested the BSEC not to adopt any policies under pressure from any quarters or individuals.

"Interest of the capital market and investors should be prioritised while framing any policies."

Previously, it was observed that influential individuals were often given special offers or waivers for various approvals.

Following the 2010-11 stock market crisis, the securities regulator issued licences to stock market-related companies without properly assessing the professionalism of the applicants.

As a result, a significant number of asset management companies received licences after 2010, leading to a total that is now disproportionately higher than that of India.

But the country's mutual fund industry still remains in a dire strait and some unscrupulous fund managers have embezzled unit holders' money.

On the other hand, total assets under the management of a few fund managers in India are higher than the size of the GDP (gross domestic product) of Bangladesh.

"Apart from considering overall interests, the regulator should assess the integrity and professionalism of an individual and company before allowing them in the capital market," said the BMBA president.

BMBA representatives have urged the regulator to make the government aware of the importance of the country's capital market.

They emphasised that the capital market should be considered in the government's national budget plans, as it can play a significant role in addressing budgetary shortfalls.

The merchant bankers also have laid importance on tax incentives to facilitate the listing of multinational and local companies having good fundamentals and introduction of new products for secured investments for small investors.

At the meeting, DSE Brokers Association (DSE) said the reforms in the capital market should be led by individuals not affiliated with the securities regulator.

DBA President Saiful Islam said that the regulator is burdened by its regular responsibilities. Therefore, the DBA has proposed the formation of a task force to implement necessary reforms in the market.

"A research-based plan should be taken up to address the failures observed over the years in the market," Islam said.

[email protected]