The securities regulator Bangladesh Securities and Exchange Commission (BSEC) in early this year launched the Alternative Trading Board (ATB), an alternative stock trading platform, but it is yet to make any significant headway due to policy complexities.
Now, the regulator itself understands that they should simplify policies to encourage more companies coming to this platform, and necessary measures have already been taken to make this happen, BSEC sources familiar with the matter said.
Six months have already passed since the inception of the ATB on January 4 this year, but so far, only a single company gets listed on this platform.
The prime reason for the aversion towards this trading platform is that an investor cannot sell any ATB-listed shares before the completion of 90 days after the purchase of any share.
If they sell shares in breaching this rule, their profits will be seized and be deposited in the Investor Protection Fund.
Both the top brasses of the BSEC and the DSE now feel that this policy is the major hindrance to popularising the ATB market.
Talking to The Business Post, BSEC Chairman Professor Shibli Rubayat Ul Islam said, “The ATB market fails to become popular owing the complexity in some policies, and one of them is the setting the 90-day time-frame for share selling.”
“This provision was put in place due mainly to prevent manipulation in the ATB market, but now that the issue is being seen as a barrier; so, it should be changed. And we are working to simplify policies to make this platform popular among investors.”
“We, however, are considering introducing an alternative option for the protection of the ATB market,” the BSEC chairman said.
Currently, Lankabangla Securities is the lone listed firm on the ATB Market, while Bengal Meat, and AFC Health are on the listing pipeline.
Lankabangla Securities, an associate firm of Lankabangla Finance got listed on the ABT market through the issuance of Tk 2.69 crore shares.
With a fair value of Tk 14.90 each, the company’s per share traded at Tk 17.80 on Thursday.
In a press conference in May 2022, the Dhaka bourse said that 76 open-end mutual funds, 18 equity securities, and 15 debt securities in the country were ready for listing on the ATB.
Dhaka Stock Exchange (DSE) Chairman Hafiz Muhammad Hasan Babu said, “We have already sorted out reasons why the ATB market remains unpopular. Efforts are underway to resolve them.”
“Necessary initiatives will be taken to keep the ATB platform active, like the SME platform, in future,” he added.
Another barrier to the vibrancy of the ATB Market is that each listed security may increase or decrease by only 4 per cent in the first two working days. Trading in those securities gets closed on the third working day, and on the fourth working day, a circuit breaker of 5 per cent is imposed.
Investors do not get any margin benefit from buying any ATB securities.
The ATB platform was launched to facilitate trading of unlisted and listed securities, including corporate bonds, alternative investment funds, and perpetual mutual funds.
There is no minimum capital limit for enrollment in ATB. Any unlisted company registered with the Directorate of The Registrar of Joint Stock Companies and Firms (RJSC) is allowed to trade shares on this platform.
Besides, on September 16, 2021, a directive from BSEC asked 18 companies in the over-the-counter (OTC) market to shift to ATB platform. Accordingly, in August 2020, the capital market regulator, BSEC, had approved the DSE Alternative Trading Board Regulation 2022. However, in order to establish ATB as a dynamic and clean platform, the OTC market companies have not been listed on ATB so far.
