Call for investing pension, gratuity, PFs worth $6bn in stocks

At present, the country’s several institutions and organisations hold provident, pension, and gratuity funds worth $6 billion which can be invested in the stock markets, said participants at a public hearing on Wednesday.

If such a big chunk of funds can be brought in stocks and mutual funds, the markets will be more vibrant and dynamic, according to them.   

However, lack of fundamental securities and skillful manpower might be a problem to manage the fund, they identified. 

The above observation was made at the public hearing organised by the Bangladesh Securities and Exchange Commission (BSEC) at the Dhaka Stock Exchange (DSE) Tower in Dhaka’s Nikunja. 

Speaking at the event, BSEC Commissioner Shaikh Shamsuddin Ahmed said, “There is about $6 billion in the form of various funds in the different institutions in the country as per the fiscal 2017-18. The market will be much bigger if we can use the huge amount of funds in the capital market.”

“Of the fund, twenty listed companies have about $55 million. If 25 per cent of the fund we can use in the capital market, the capital market will be much bigger,” he said.

“I don’t see any problem bringing the funds in stocks as the securities rules are already in favour,” said the BSEC commissioner.

DSE Chairman Md Eunusur Rahman said,” Sixty banks have about 10,000 branches and there are many financial institutions. The provident funds they are currently maintaining can be invested in stock markets.”

He said, “The way we are working to expand the market will be helpful to make the stock market vibrant.” 

Former Metropolitan Chamber of Commerce and Industry (MCCI) President Syed Nasim Manzur said, “In developing countries, provident, pension, and gratuity funds are widely used in the capital market.”

“But we have two major problems. The market lacks fundamental securities and skillful manpower to manage the funds,”

BSEC Commissioner Md Abdul Halim, Executive Director Mohammad Rezaul Karim, DSE Chief Operating Officer M Shaifur Rahman Mazumdar, and DSE Brokers Association (DBA) President Richard D’ Rozario were, among others, present at the event.