BMBA seeks incentive loan package for survival

Bangladesh Merchant Bankers Association (BMBA) has urged the government to provide incentive loan package at a 4 percent interest rate to local brokerage houses and merchant bankers to survive the negative impacts caused by the coronavirus fallout.

BMBA president Md Sayadur Rahman recently sent a letter to finance secretary Abdur Rouf Talukder in this regard.

The letter also urged the government to provide policy support to multinational and renowned local companies to encourage them to get listed on the stock markets.

Bangladesh's capital market has been suffering from a declining trend since 2018 and now the pandemic of Covid-19 is adding further woes. During the government-declared general holidays, the stock exchanges were kept closed. Therefore, no trading activities took place in the country and no income was generated for merchant bankers and stockbrokers, the letter mentioned.

However, an official of the finance division said, “The government has provided financial support to 19 sectors under that incentive package and we do not want to include a new one.”

Financial consultant Shafi Rahman said incentive loan package may not recover the local market from Covid-19 fallout unless the country‘s flagship companies off-load their shares in the market.

There are 250 brokerage houses with 10,000 staff in the country. Also, 63 merchant banks with 1,000 staff operating in the country’s two stock markets.