The Bangladesh Merchant Bankers Association (BMBA) has placed a proposal to form a Tk 10,000 crore fund that the regulator would use to ensure adequate cash flow to the market during any liquidity crisis.
The fund will be managed by the Capital Market Stabilization Fund (CMSF) by issuing bonds, according to the proposal.
The BMBA sent a letter to Bangladesh Securities and Exchange Commission (BSEC) in this regard on Monday, said its President Sayedur Rahman.
According to the letter, the capital market recently became volatile despite many initiatives by the BSEC, which put pressure on investors to sell their shares. Adequate cash assistance is needed to restore normalcy in the market against such a backdrop.
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“Therefore, we are proposing to set up a special fund of Tk 10,000 crore for market intermediaries from Capital Market Stabilization Fund (CMSF) through bond issues and provide long-term loans to low-interest market intermediaries,” read the letter.
If the funds are properly invested by market intermediaries, the existing problems would be solved and the market liquidity crisis will be alleviated, the letter added.
The BMBA further said information will spread among the stakeholders that the government is working with the regulatory body for market development in this initiative.
Besides, it will increase confidence among investors and keep the market moving normally.
