BD capital market base, stability established: Finance Minister

BD capital market base, stability established: Finance Minister

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Dhaka – Finance Minister AMA Muhith said that stability and base has already been established in the capital market, which is a positive sign to escalate the market forward.
The minister said this at a programme- ‘Seminar on Bangladesh capital market; present scenario and future prospect- organised by BMBA (Bangladesh Merchant Bankers Association) at a city hotel on Wednesday.Muhith expects growth in capital market in near future. “The bourse market has already established as rule based so far and by 2018, it would be an entirely active capital market.”
With the size of the capital market, Muhith expects that the large corporations should come and issue bonds so that there would be no deficit of subscriptions in the market. Muhith also thinks that as country’s assets are rising, so investment should come from the capital market.
Muhith also told that, “Though the capital market formed at early 50s and started growing in 80s, in reality, still we cannot create any bond market. In 1964, I myself invested to the capital market and bond market as well,”
President of BMBA Sayadur Rahman said at the event that five to six years back the market was completely unstable and turmoil, but now it stands on robust foundation. He mentioned that a couple of initiatives have already been taken and the consequences are visible to everyone. The initiatives are; establishment of demutualisation act, lots of new rules and regulations, surveillance software, establishment of special tribunal, bring up BSEC (Bangladesh Securities and Exchange Commission) from B to A category, feasible the clearing commission.
“BMBA formed in 2004 with only 18 merchant banks and it has crossed 50,” he added.
Managing Director of IDLC Md Moniruzzaman, presented a keynote paper, said that, in 2004, the turnover used to be Tk10 crore and now it reflects to Tk 435 crore. In 2004, market capitalisation was 1.6 billion and now it turns out to be 34 billion.
Md Moniruzzaman demonstrated sectoral performances of different companies on the basis of CAGR (Compound Annual Growth Rate), where MNCs were at the top and it came out that 50 per cent companies performing well for last 4 years.
Md Moniruzzaman also cited an example of a tobacco company is appreciated 700 times compare to a financial institution.
According to a report of world financial market 2013; world capital market GDP contribution is 217.33 per cent and Bangladesh it is only 18.46 per cent. It shows that there is an ample amount of opportunity to grow in the market and it is a positive sign as well.

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