SEC extends deadline for brokers, m-bankers to Sept 30
The Securities and Exchange Commission on Tuesday extended the deadline to September 30 for the brokers and the merchant bankers to waive the interest
of margin loans given to small-scale investors in 2011.
‘The commission has taken the decision at an emergency meeting today following an application submitted by the Bangladesh Merchant Bankers Association,’ SEC executive director Saifur Rahman told New Age.
He said that the brokers and the merchant banks would have to waive the interest and inform the Dhaka and Chittagong bourses within September 30.
He also said the new time for compliance report submission by the stock exchanges in this regard would be announced later.
On July 10, the SEC asked the brokerage houses and the merchant banks to waive by August 14 half of the interest on margin loans taken by investors in 2011.
The SEC also asked the Dhaka and the Chittagong stock exchanges to submit a report of compliance status of the order by August 30.
The waiver of margin loan interest is a part of the stock market compensation package announced by the government for the affected investors in the 2011 market crash.
The investors who had investment up to Tk 10 lakh in 2009 and 2010 will get the compensation, including the interest waiver.
Under the order, 28 merchant banks and 288 brokerage houses of the Dhaka and the Chittagong bourses will waive 50 per cent of the interest on margin loan given in 2011.
DSE president Rakibur Rahman and BMBA president Mohammad A Hafiz on Monday told that they were facing various difficulties to implement the order.
The BMBA will also request the Bangladesh Bank for a Tk 900-crore credit facility for three years with an interest rate of 10 per cent to implement the compensation package.
‘The merchant banks committed to assist the government to implement the package,’ a senior SEC official told New Age.
He said that the institutions would face some losses but they should bear the responsibility.
‘They can do it just by taking some loss. The market is depressed and they are suffering but the brokers and the merchant banks must do it as they promised,’ he said.
‘Otherwise, the SEC will take action against them as per securities law,’ he added.
After a free-fall in the share prices in 2011, prime minister Sheikh Hasina in November last year had asked the SEC to work out a package to minimise the losses incurred by investors in the crash.
Courtesy of New Age