Initiatives to Increase IPOs, Reduce Listing Fees to Restore Market Confidence

An emergency virtual meeting was held with representatives of member firms of the Dhaka Stock Exchange (DSE) and the DSE Brokers Association (DBA) to review the current state of the capital market and address market volatility.

The meeting, held at 11am on Tuesday, September 8, discussed various measures to stabilise the market, restore investor confidence and ensure normal trading.

At the beginning of the meeting, DBA President Saiful Islam said such an exchange of views was timely to address the concerns and confusion among investors and market participants amid the current situation.

He said most brokerage houses and market-related institutions are currently facing various challenges. Therefore, the DSE, regulatory bodies and all relevant stakeholders must work together to maintain market confidence and normal operations.

He also said the common goal should be to build a compliance-based, vibrant, efficient and growing capital market rather than suppressing the market.

At the meeting, DSE Chairman Mominul Islam said important initiatives had been taken after discussions with the Bangladesh Securities and Exchange Commission (BSEC) regarding the Investor Protection Fund (IPF) to safeguard investors’ interests.

He said the lack of new initial public offerings (IPOs) for a long time and the limited presence of fixed-income financial products are among the major weaknesses of the country’s capital market. As a result, listing fees for new bonds have been reduced.

In addition, it has been decided to waive 50 percent of the first-year listing fee for companies applying for an IPO or direct listing until March 2027. The DSE expects these measures to increase the supply of new companies and financial products and make the market more dynamic.

Regarding allegations of excessive intervention in brokerage houses, the DSE chairman said the board does not interfere in the day-to-day activities of the regulatory affairs department and only provides policy guidance. If information about a specific irregularity is received, an investigation or inquiry will be conducted only into that matter.

He urged member firms to promptly resolve any shortfalls in client consolidated (CC) accounts, shares or other assets on their own initiative. Such shortfalls negatively affect not only the operations of the concerned institution but also the reputation and effectiveness of the entire capital market.

Mominul Islam said all stakeholders must properly fulfil their respective responsibilities to make the market more disciplined, transparent and compliant with international standards. He expressed optimism that Bangladesh’s capital market could reach a new level within the next five years through collective efforts.

He also urged member firms to share their problems, concerns, suggestions and new ideas with the DSE, saying future market development initiatives would be implemented more effectively based on members’ practical experiences and opinions.

The meeting was informed that some inspection activities related to compliance and surveillance for 2025 remain unresolved, and their reports need to be submitted to the BSEC. As part of the process, inspections have recently been conducted at various brokerage houses. Participants in the discussion emphasised the need to establish clear and specific criteria for identifying abnormal transactions.

They said a large volume of share trading at a particular time should not, by itself, be considered an irregularity. Instead, factors such as the nature of the transaction, its impact on prices, the investor’s financial capacity and the trading instructions should be taken into account when assessing transactions.

Participants expressed hope that coordinated efforts by the regulatory authorities, stock exchanges and all market stakeholders would help overcome the existing volatility and restore investor confidence in the country’s capital market.