Business Desk :
The Bangladesh Securities and Exchange Commission (BSEC) has eased the requirements for participating in the small and medium enterprise (SME) board to attract more investment and reduce hassle for investors.
Effective on both bourses from Sunday, the eased regulations state that the minimum stock market investment requirement has been lowered to Tk20 lakh from the previous Tk50 lakh as the eligibility criteria for trading on the SME board.
Market insiders agree that this decision could increase the number of qualified investors, thus making the board more vibrant and functional.
BSEC Executive Director and Spokesperson Rezaul Karim told that the commission made the decision as the newly launched SME platform has seen slow performance due to the Tk50 lakh investment limit and requirement of registration for eligible investors.
According to the new notification, the Central Depository Bangladesh Limited will provide detailed information of the eligible investors based on the minimum investment condition on a quarterly basis.
The stock exchanges must provide fully automated registration, free of cost, for the purpose of trading securities listed with the SME platform, meaning investors would not need to register themselves for trading on the SME board.
Eligible investors will receive an SMS informing them that they can trade on the board, the notification further reads.
“This decision will reduce the hassle for investors and increase the number of qualified investors,” said DSE Director Shakil Rizvi.
“Now, the registration will be completed automatically if an investor has a minimum of Tk20 lakh in investment. They will get an SMS that now they are eligible to invest in the SME platform. The investment figure can be calculated based on market value or cost, whichever is higher as per the portfolio statement,” he explained.
According to the Dhaka Stock Exchange (DSE), there are currently about 27,000 institutional investors with an investment of Tk50 lakh or more in the stock market.
The first SME board was launched on the Chittagong Stock Exchange (CSE) in June last year. It was launched on the DSE in September.
However, SME board transactions on the two stock exchanges have yet to gain popularity.
