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BSEC chairman Prof. Shibli Rubayat Ul Islam on Saturday stressed the need for increasing the size of mutual funds (MFs) and improving the performance of fund managers to help achieve desired grow of the industry.
He suggested increasing the aggregate size of MFs to around Tk 1.5 trillion from only Tk 150 billion at present.
"Why are you not talking about the necessity of increasing the size?" the Bangladesh Securities and Exchange Commission (BSEC) chairman told a webinar as chief guest.
The Association of Asset Management Companies and Mutual Funds (AAMCMF) organised the programme titled "Institutional Role in Sustainable Financing" as part of observing the World Investor Week 2021.
BSEC commissioner Prof. Mizanur Rahman was the special guest of the programme, chaired by AAMCMF president Dr. Hasan Imam.
Prof Islam called upon all concerned to discuss about how the aggregate size of the MFs can be increased and assured the better-performing MFs of necessary cooperation in this regard.
"The MFs distributed good dividends this year. The fund managers should utilise the ongoing fruitful time to ensure the desired growth of the industry," he said, adding: "The securities regulator should be informed about obstacles hindering the industry growth."
He also criticised charging high management fees by some of the fund managers despite their performances not up to the mark.
Referring to the publicity of Indian MFs, the BSEC chairman said lack of publicity is a big problem for the country's MF industry and suggested the association come forward if the cost of publicity becomes a burden for the individual fund managers.
"The fund managers will have to carry out publicity of the MFs at a large scale along with removing ambiguity, if any," he said.
He also expressed frustration over the banks' reluctance in making investments in MFs despite the investors realised an average return of more than 10 per cent this year.
"An expansion of the stock market will also help boost banks' income as all transactions of the stock market are executed through the banks," he said.
Prof Islam informed the webinar that the securities regulator held talks with the revenue board to seek more facilities for the MFs and bonds. "The government's revenue earnings from the stock market can be increased by 100 times," he said, without elaborating.
AAMCMF president Dr Imam said that now it is a time to say that the MFs are the most attractive investment sector as it performed well this year and distributed an aggregate amount of cash dividend worth Tk 6.0 billion.
He said that the regulator inspired the MFs to invest in the listed companies having good fundamentals.
He also said the investors now have a scope of getting higher returns from the MFs as the market prices of the units of many funds are lower than that of their respective net asset values.
Prof. Mizanur Rahman, a BSEC commissioner, Md. Abul Hossain, managing director at Investment Corporation of Bangladesh (ICB), Mr. Arfan Ali, managing director at Bank Asia, among others, also spoke at the webinar.