The Bangladesh Securities and Exchange Commission has rejected a proposal of First Security Islam Bank Limited to issue rights share to raise Tk 200 crore as the bank failed to comply with rules related to defaulted loans. A BSEC notice posted on Dhaka Stock Exchange on Tuesday said, ‘The BSEC is not in a position to consider the application of First Security Islami Bank regarding approval of rights issue as the company has failed to comply with the requirement of rule 3[f] of the Securities and Exchange Commission [Rights Issue] Rules, 2006.’
As per the section 3 (f) of Rights Issue Rules, the commission should reject a rights offer of any company if it or any of its directors is a bank defaulter.
The board of directors of FSIBL, a private bank with a paid-up capital of Tk 411.40 crore, in March this year decided to offer investors one rights share against two existing shares.
Initially, the issue price of each rights share was set at Tk 12 including a premium of Tk 2.
The company, however, in June this year revised the decision by setting the issue price of each share at Tk 10 instead of Tk 12.
The company in 2010 issued one rights share against five existing shares.
The bank got enlistment with the capital market in 2008.
As per the un-audited half-yearly accounts of the bank for the period of January-June, 2014, consolidated net profit after tax of the entity stands at Tk 30.38 crore with an earning per share of Tk 0.74 against a profit of Tk 24.61 crore and Tk 0.60 respectively for the same period of the previous year.
-With New Age input
