BSEC raises credit facilities for investors

The Bangladesh Securities and Exchange Commission (BSEC) has further extended the margin loan facilities in a bid to arrest continuous share price decline.

The margin loan limit was set at 1:1, meaning an investor will get Tk 100 against the deposit of the same amount for any marginable company, said the regulator in a statement on Sunday.

The previous margin loan ratio was 1:0.8.

The market regulator revised the credit facilities to facilitate investors for purchasing shares to increase money flow to the downtrend stock market, said a BSEC executive.

On Sunday, the benchmark DSEX index closed at 6,142, down 115 points, or 1.8 per cent—a level not seen since June 29, 2021, when it was 6,042.

Sunday’s plunge surpassed the previous record for the biggest single-day fall, when the market had registered a fall of 135 points on April 16, 2022.

With the plunge, the index extended its losing streak for the 8th consecutive session for the first time in four years since April 30, 2018, when the index dropped for the 13th consecutive session from April 30 to May 20, 2018.

In eight days, it lost 555 points during the period.

On November 15 this year, the BSEC scrapped index-based margin loan facilities and allowed stockbrokers and merchant banks to provide a maximum of 80 per cent of investors’ deposits as margin loans.