The Securities and Exchange Commission on Tuesday decided that the face value of shares of all companies and units of all mutual funds would have to be converted to Tk 10 from December 1.
Of the 231 companies listed with the Dhaka Stock Exchange, currently 124 companies have shares of Tk 100 face value and 107 of Tk 10.
Of 36 listed mutual funds, 14 have units of Tk 100 face value, and one has units of Tk 1.
The commission took the decision to set a uniformed face value of shares and mutual fund units in line with a recommendation made by the finance ministry and a suggestion of the probe committee on the January’s stock market crash.
‘The commission decided to make the face value of all the scrip and mutual fund units uniformed to eradicate any confusion among the investors,’ SEC executive director Saifur Rahman told a press briefing.
He said, as of December 1, the face value of all shares and mutual fund units would be Tk 10 and the rule would be applicable for all future issues too.
He said the commission also set November 30 as the record date for all the companies for converting the face value of their shares, if it was more or less than Tk 10.
He said, ‘The companies will need to go through a lengthy process to convert the face value of shares.’
‘First, they will have to pass the proposal in their respective boards and then in emergency general meetings of shareholders. After that they will have to submit the proposals to the SEC for approval,’ he explained.
He, however, said, if any company failed to convert the face value of its scrip by the deadline, the SEC would halt the trading of the scrip for an indefinite period.
The probe committee on January’s stock market debacle, in its report, made a strong recommendation for making a uniformed face value of shares as it found a number of manipulations during splitting of the face value of different scrip.
Finance minister Abul Maal Abdul Muhith, while making the report public, said the government was considering the suggestion of going for a uniformed face value of shares in one of its term-to-term actions.
-With New Age input