Credit crisis hits stocks again

Share prices slide for second day
Share prices at the Dhaka Stock Exchange plunged on Sunday as the investors continued to face credit crunch, said market operators.
The benchmark general index of the DSE dropped by 141.29 points, or 1.87 per cent, to close at 7,429.59 points. The DSE’s general index shed 315.57 points at 1:40pm but regained at the closing hour of trading.
Many of the investors, who had sustained heavy losses in the last few days’ massive slides, said that although the Securities and Exchange Commission had increased the margin loan for them, they were facing fund shortage and were thus unable to buy shares at relatively lower prices to make up for their losses.
‘I had earlier taken loan at a ratio of 1:1 but the value of my portfolio [total shares] came down by 30 per cent because of the recent slump of prices. Now I cannot sell my share, nor can I buy shares for adjustment as the brokerage house refused to increase my margin loan,’ said Arif Hossain, a general investor, on Sunday.
He said that many of the investors were selling shares at a loss to get out of the market as further fall in share prices would diminish their total investment.
‘We are still panicked about the market situation as we are not getting loans. Although the SEC assured us we would get loans after the record plunges last week, we are not getting them,’ said Zobaer Ahmed.
In the last two days the DSE’s general index lost 256.08 points after the market gained by 1,191 points on Tuesday and Wednesday after six days of massive slump, including a 660 point slump in just 50 minutes of trading on Monday.
After the slumps the investors staged street demonstrations and the SEC and Bangladesh Bank took some measures to boost their confidence and calm them down.
‘The SEC’s measures now seem to be eyewash as the brokerage houses and merchant banks have not increased the margin loan by a single taka,’ said Shabbir, another unlucky investor.
The SEC increased the margin loan ratio to 1:2 from 1:1.50, decided to give the netting facility for all securities and relaxed the rules on investment of merchant banks.
The Bangladesh Bank, in response to the government’s directive, assured private banks that it would be lenient if they invest in the capital market and would turn a blind eye on the industrial loans that were used in the capital market.
Market analysts said that the investors were anxious about the current market situation as the credit shortage has cooled down the market.
The banks and non-bank financial institutions were selling their stakes to make profits out of the shares they had bought during the slumps, they added.
Besides, the banks are now more cautious about investing in the share market and are not providing much funds to their subsidiary merchant banks, said a merchant banker.
Commenting on Sunday’s market trend, analyst Akhtar H Sannamat said, ‘The credit crisis is the main reason for volatility in the capital market… Life support is not a solution for the market. The government should take some initiative to increase liquidity flow into the capital market from banking channels.’
Salahuddin Ahmed, a former chief executive officer of the DSE who has returned to his original profession of teaching finance at Dhaka University, said, ‘Liquidity flow should be ensured for a sustainable market and to restore confidence in investors.’
‘The present situation is an unusual price correction in the market and I request the investors not to be worried,’ he added.
Out of the total of 247 issues traded on the DSE on Sunday, 215 declined and 32 advanced.
The daily turnover at the bourse stood at Tk 1,166.62 crore, up by Tk 103.25 crore from that of the previous day.
The NBL topped the turnover leaders with 33.39 lakh shares worth Tk 58.05 crore on the day.
The rest of the other turnover leaders were the United Commercial Bank, Beximco, Grameenphone, AB Bank, Titas Gas, United Airways, Square Pharmaceuticals, Southeast Bank and Bay Leasing and Investment.
Square Pharmaceuticals was the biggest gainer of the day, posting 6.09 per cent rise in its share price, while the City General Insurance was the worst loser.


Via: New Age

Related News

Islami Bank wins ICMAB Best Corporate Award 2021

Business Desk : Islami Bank Bangladesh Limited IBBL won the ICMAB Best Corporate Award 2021 for “Private Commercial Bank (Islamic Operation)”. Commerce Minister Tipu Munshi handed over the award to Muhammad Qaisar Ali, additional managing director of the bank Thursday (1 December) at a ceremony held at Hotel InterContinental Dhaka. JQM Habibullah, additional managing ... Read more

Brac Bank holds fire safety awareness sessions during Fire Service Week

Business Desk : To observe Fire Service Week, Brac Bank held a fire safety awareness event for its people in conjunction with the Fire Service and Civil Defence Department. The bank arranged a fire safety drill at its head office in Dhaka on 17 November, said a press release. The department observes Fire Service ... Read more

Premier Cement Mills PLC obtains ICMAB ‘Gold Award’ for cement manufacturing

Business Desk : Once again, Premier Cement Mills PLC has taken home the Gold in the Cement Manufacturing category at the ICMAB Best Corporate Award 2021. Mohammed Amirul Haque, managing director of Premier Cement Mills PLC, received the award from Commerce Minister Tipu Munshi at a city hotel on 1 December.  Among others Federation ... Read more

IPDC Finance took home “gold” for ICMAB Best Corporate Award 2021

Business Desk : IPDC Finance was honored with the Gold Award in the NBFI category at the ICMAB Best Corporate Award 2021. The awards event took place on Thursday, December 1 at the Intercontinental Dhaka, said a press release issued in this regard. Commerce Minister Tipu Munshi handed over the awards to the recipients as ... Read more

Agora, BD Recycle Technologies to work on solid-waste management 

Business Desk : Agora Limited has recently joined hands with BD Recycle Technologies Limited (BRTL) to work together with the goal of ensuring sustainable solid-waste management. A memorandum of understanding has been signed in this regard, where these two institutions will work towards environmental protection through modernisation of waste management, reads a press release. ... Read more

ICMAB Best Corporate Award goes to 65 firms

Business Desk : A total of 65 businesses were awarded the “Best Corporate Award 2021” by the Institute of Cost and Management Accountants of Bangladesh (ICMAB) for their efforts in establishing corporate governance. After examining each company’s annual report, the ICMAB presented them with honors Thursday night at a local hotel during its annual ... Read more

Meghna Bank to avail mobile financial solution platform

Business Desk : Meghna Bank recently signed a tripartite agreement with ModeFinServer Private and Genex Infosys at the bank’s head office in Gulshan, Dhaka to avail a mobile financial solution platform from the former and provide logistics and localisation support from the latter.  Sohail RK Hussain, managing director of Meghna Bank, Amarnath Chowdhury, managing ... Read more

Citibank NA appoints New Country Officer in Bangladesh

Business Desk : Citibank NA Bangladesh recently appointed a new country officer.  The appointee, Md Moinul Huq, joined Citibank NA in 2002 and previously worked for Al Baraka Bank and Dhaka Bank, said a press release. As country officer, Huq will lead the Citi franchise in Bangladesh and will be responsible for Citi’s business ... Read more

Shwapno establishes new outlet at Aftabnagar Siraj Convention Centre

Business Desk : A new outlet of the retail shop Shwapno was inaugurated at the Siraj Convention Centre in Aftabnagar, Dhaka. An event was held to mark the occasion on Tuesday noon, reads a press release issued in this regard. The programme was attended by landowner Md Siraj, Shwapno Head of Retail Administration Saiful ... Read more

Rezina Parveen becomes DMD of Agrani Bank

Business Desk : Rezina Parveen was recently appointed as the Deputy Managing Director of Agrani Bank Limited. She formerly held the position of General Manager at Janata Bank, where she gained both respect and success, before moving on to Agrani Bank. She served as acting CEO of Janata Capital and Investment Limited, which is ... Read more

Janata Bank assists Bangladesh Kabaddi Federation financially

Business Desk : Janata Bank Limited recently gave money to the Bangladesh Kabaddi Federation to help them set up an independent welfare fund to pay for injured players’ medical bills. A press release says that Abdus Salam Azad, MD and CEO of Janata Bank and Vice-President of Bangladesh Kabaddi Federation, gave the donation check ... Read more

Two-day ‘Bima Mela’ was organized at Barishal

Rupali Insurance demonstrated the most innovative customer service during the event. Business Desk : On the 24th and 25th of November, 81 property, casualty, and life insurance companies displayed their products during the two-day “Bima Mela 2022” in Barishal. Visitors were happy to take part in a variety of games and activities organized by ... Read more

MTB Foundation and Buet provide student scholarships

Business Desk : The Bangladesh University of Engineering and Technology (Buet) and the Mutual Trust Bank (MTB) Foundation recently held a “Saifuddin Ahmed Chowdhury Memorial Scholarship” program at the Buet academic council bhaban in Dhaka. The programme aims to provide funds on a monthly basis to 33 students of 12 departments, said a press ... Read more

Jamuna Bank Foundation holds free plastic surgery camp

Business Desk : A free plastic surgery camp for cleft lip, palate, and burn patients was held at Munshiganj General Hospital by Jamuna Bank Foundation. Specialized doctors from the Netherlands provided treatment during the camp, reads a press release. Local government Tazul Islam attended the camp as the chief guest. Chairman of Jamuna Bank ... Read more

Disney Star and Beximco Digital Distribution reach broadcast agreement in Bangladesh

Business Desk : Beximco Digital Distribution Limited (BDDL), a concern of Beximco Group has signed a deal with Disney Star to distribute eight of their popular entertainment television channels across Bangladesh via paid television service through cable, IPTV, and OTT. The collaboration will see BDDL distribute Disney Star’s channels in the original languages of ... Read more

6 Organizations and 5 Individuals get Best CSR Awards 2022

Business Desk : Six organizations and five individuals were recognized with “A Better Tomorrow CSR Awards 2022” for making positive contributions to society through various projects. The awards were presented by Planning Minister Abdul Mannan at a ceremony held at Le Meridian Dhaka in the capital, according to a press release. The Daily Star ... Read more

Nagad gets two MasterCard Excellence Awards 2022

Business Desk : The Postal Department’s Nagad mobile financial service won the “Mastercard Excellence Award 2022” for its digital innovation in Bangladesh’s financial industry. According to a press release, Nagad won its second online award for its outstanding merchant business contributions. Mastercard recently held the “Mastercard Excellence Award 2022” ceremony in Dhaka’s five-star hotel ... Read more

Rupali Bank made Tahmina Akhter DMD

Business Desk : Rupali Bank Limited has appointed Tahmina Akhter to the position of Deputy Managing Director (DMD). The Financial Institutions division of the Ministry of Finance issued a circular in this regard recently, reads a press release.  Before joining as DMD, she successfully served as general manager in the same bank. Tahmina Akhter ... Read more

Asian Banker named Islami Bank as ‘Strongest Bank’

Business Desk : Singapore-based banking and financial intelligence platform The Asian Banker has named Islami Bank Bangladesh the “Strongest Bank in Bangladesh” and the “Strongest Islamic bank in Bangladesh” for 2022. Foo Boon Ping, the platform’s managing editor, announced this on Thursday through a virtual platform which was joined by Mohammed Monirul Moula, managing ... Read more

1000th sub-branch of IFIC Bank opens in Meherpur

In an effort to create the most extensive and technologically advanced banking network in the country, IFIC Bank has inaugurated its 1000th sub-branch in Mujibnagar, Meherpur. The bank’s chairman and Adviser on Private Industry and Investment to the Prime Minister Salman F Rahman and State Minister for Public Administration Farhad Hossain was present as the ... Read more