The Bangladesh Securities and Exchange Commission has instructed merchant bankers to bring companies with sound fundamentals for listing for the sake of their own reputation and the development of the capital market.
M Khairul Hossain, chairman of the BSEC, came up with the instruction while opening the office, logo, and website of the Bangladesh Merchant Bankers Association (BMBA) at a programme at the Hotel 71 yesterday.
“We give approval to companies to raise capital from the market on the basis of the disclosure of information. So, merchant bankers have to ensure that the disclosures are real and complete.”
As the issue managers, the merchant banks have a huge responsibility to maintain the reliability of all the disclosures of new companies to help investors get the real picture of the firms that plan to go public, he said.
The chief of BSEC also asked merchant bankers not to inflate the earnings of the companies that want to be listed, as inflated figures put the stockmarket regulator in an embarrassing situation.
Hossain said the commission has worked relentlessly in the last seven years to develop the market.
On Tuesday, the government extended the tenure of Hossain as the chairman of the stockmarket regulator by two years. He has been serving the BSEC for the last seven years.
He urged large companies to raise funds through the capital market in order to avoid difficulties in getting bank loans.
Hossain also touched upon the issue of picking a strategic partner of the Dhaka Stock Exchange.
“The process is underway and the strategic partner of the DSE will deepen the depth of the capital market.”
According to Hossain, the strategic partner will not only bring some investments to the market but also ensure governance in the stock exchange.
“The capital market now stands on a strong platform and it only requires positive policy support with a long-term vision,” said BMBA President Mohammed Nasir Uddin Chowdhury.
Chowdhury said the capital market witnessed huge reforms, including the demutualisation of Dhaka and Chittagong stock exchanges, after 2010 as per the guidance and supervision of the commission.
BSEC Commissioners Md Amzad Hossain and Swapan Kumar Bala were also present.