Big-scale change to take place in capital market within 2 years: Shibli

Bangladesh Securities and Exchange Commission (BSEC) Chairman Shibli Rubayat-Ul-Islam on Saturday said that a big-scale change would take place in the capital market within the next two years.

“We hope that a very big-scale change will take place in the capital market within the next two years. Only then, we’ll be able to come out from the “Shallow Capital Market”. We’re going to all the financial hubs or commercial centers across the globe. We’ve already visited Dubai and received a good response,” he said.

Shibli was speaking at the maiden ‘Economic Reporters’ Forum (ERF) Dialogue on Business and Economy’ at the ERF office in the capital.

He said that BSEC has targeted at least six big industrial local conglomerates to bring on the stock markets to remove the crisis of quality shares on the markets.

The annual turnover of those six companies is above $2.5 billion. And of the six companies, one company has nearly $4 billion annual turnover, Shibli said.

“The company which has the $4 billion turnover has already contacted the BSEC for offloading its share on the stock market,” said the BSEC chairman.

He said many people think that Bangladesh has not such big companies. But, it is true that there are so many companies in Bangladesh which have $1 billion turnover in a year, he added.

“With the economic growth of the country, the companies have also grown over the years which prove the country’s financial strength.”

However, the chairman declined to mention the names of those companies. Currently, the stock market size of the country is Taka 5,00,000 crore which was Taka 3,50,000 crore even a few months ago which mainly indicates a positive trend of the markets, the BSEC chairman added.

“We are expecting a major change on our stock markets within next two years as we have taken some bold steps for continuing the positive trend on the stock markets,” he said.

For instance, he said, the BSEC has been working for revival of the bond transactions on the markets and also to enlist new kinds of bonds from home and abroad.

He mentioned about the listing of Sukuk bond. Moreover, the BSEC is going to hold roadshow in Switzerland and Germany in June for attracting more bonds on the stock markets in Bangladesh.

The BSEC has also been receiving responses from other major global business districts like Australia, Toronto and in the UK for holding the roadshows in those areas for investing in bonds on the stock markets.

Replying to a query from a journalist, Shibli also said the stock market’s IT would be strengthened soon to make enable them for transaction of big amount of bond as currently, the IT system of the stock exchanges is not so much capable to handle the transactions of big amount of money of bonds.

Regarding the forgery in the audit report by a section of listed companies on the markets, the BSEC chairman said the BSEC has been working with other regulatory bodies like National Board of Revenue (NBR), Financial Reporting Council and other bodies concerned for agreeing on accepting the unified audit reports.

Because, many companies publish forged audit reports in connivance with a section of unscrupulous audit companies which give false earning per share, he said.

The BSEC chairman said currently, the government allows hedge fund for one year, but it should be more than one year so that the local companies can purchase commodities at cheaper rates to make a good business with global movement of price barometer.

Regarding the role of stock market on generating capital for industrialization, Shibli said the bourses should be the ground for long-term financing instead of banks.

Because the banks cannot carry the loan for long time although such kind of financing has been taking place in the country for the absence of strong financing by the bourses.

Shibli also said the BSEC has been investigating a claim of allegation of anomaly of the Padma Bank and the stock market regulatory body will take action as per the law if it is found to be proved after the investigation.

However, the BSEC chairman did not disclose detail about the allegation.

Sharmeen Rinvy, president of the ERF chaired the discussion and SM Rashidul Islam, ERF general secretary moderated the event.

(BSS)