M-banks daily stock reporting to BB might be made weekly
Bangladesh Bank will coordinate with the Bangladesh Securities and Exchange Commission in making any capital market-related decision in future, BSEC commissioner Amzad Hossain told reporters on Sunday. The BSEC commissioner’s comment came after a coordination meeting held among BB, BSEC, Insurance Development and Regulatory Authority and Microcredit Regulatory Authority at the central bank’s headquarters in the capital.
When asked about the recent decision taken by the BB on banks’ stock-related issues bypassing the BSEC and ignoring a government directive, Amzad also said that BB in the past supported the capital market in various ways and hoped that it would continue its support in future.
BB deputy governor SK Sur Chowdhury said that the BSEC at the meeting opposed a BB move that directed banks to report to the central bank on a daily basis the capital market investment by their merchant banks and brokerage houses.
The stock market regulator said that the move would impact negatively on the capital market, he said.
‘The BB may review its decision,’ Sur said.
He said that the reporting might be weekly or monthly basis.
Asked, whether the BB issued the directive by ignoring a finance ministry directive which asked to coordinate with the BSEC before making any capital market-related decision, Sur said, ‘The recent directive was issued not to ignore any government directive but to act as per the authority given to the BB in the latest amendment to the Bank Companies act.’
The latest amendment has allowed the BB to inspect and issue directive to the merchant banks and brokerages houses under banks and that’s why the BB is monitoring banks’ capital market investment through their subsidiaries, the BB deputy governor said.
‘If the BB refrains from monitoring banks’ capital market investment and anything unpleasant happens, the central bank will be held responsible,’ Sur said.
He said the BB would try to bridge the coordination gaps between the financial sector regulators and they were arranging the coordination meeting in this regard.
Sunday’s meeting also decided to form a financial stability group in a bid to improve better coordination between the financial sector regulators and to ensure stability in the financial sector, he said.
‘We have also asked the BSEC about the progress of the refinance scheme worth Tk 900 crore and they have informed that the fund release to the small-scale investors affected by the stock market crash is delayed due to a condition imposed by the Investment Corporation of Bangladesh,’ Sur said.
Representative of Insurance Development and Regulatory Authority and Microcredit Regulatory Authority were also present in the meeting.
-With New Age input
