Govt to sell 8.5pc stake in IFIC Bank
Thursday, 9 August 2007
The government is set to sell part of its stake in the IFIC Bank Limited, a top official said Wednesday, reports bdnews24.com.
According to the plan, the government will offload 8.5 per cent or 1,20,000 shares out of its holdings of 35 per cent or over 14,00,000 shares in the bank.
"It's a welcome move when the demand is high now. Supply of issues should be increased considering the long-term development of the market", Securities and Exchange Commission (SEC) Chairman Faruq Ahmad Siddiqi said.
The government has already appointed Investment Corporation of Bangladesh (ICB), a state-run investment bank, as manager of the issue.
The move came in line with a decision on offloading of shares of state-run enterprises in power, energy and banks.
A senior official with the ICB, who wished to remain unnamed, said IFIC Bank shares were still paper-based and needed to be converted into market lot.
"Shares of IFIC Bank need to be divided into market lot. If the government decides to demat (dematerialise) the shares through CDBL, it will be possible to automatically convert them", he said.
"We have already informed the government of the matter", he added.
The official failed to say when the shares would hit the market. "It depends on how fast the government moves", he said.
IFIC Bank was listed on the stock market in 1986 with a total of 40,63,861 shares. The book value of each share at Tk 100.
According to the Dhaka Stock Exchange, sponsor-shareholders of the bank hold 34 per cent stakes while general or public holdings account for 31 per cent shares of the bank.
Shares of the bank are now traded as Z or low-quality shares due to its failure to hold annual general meetings (AGMs) for three years since 2003 because of a legal wrangle in the court.
The High Court, however, has ordered the bank to hold pending AGMs. Following the court directive, it posted 30 per cent stock dividends for three years since 2003.
The bank also announced 24 per cent stock dividend for 2006.
The IFIC Bank, with a total share capital of Tk 406 million, also received permission from the central bank to raise its authorised capital to Tk 1.6 billion from Tk 500 million.
According to the plan, the government will offload 8.5 per cent or 1,20,000 shares out of its holdings of 35 per cent or over 14,00,000 shares in the bank.
"It's a welcome move when the demand is high now. Supply of issues should be increased considering the long-term development of the market", Securities and Exchange Commission (SEC) Chairman Faruq Ahmad Siddiqi said.
The government has already appointed Investment Corporation of Bangladesh (ICB), a state-run investment bank, as manager of the issue.
The move came in line with a decision on offloading of shares of state-run enterprises in power, energy and banks.
A senior official with the ICB, who wished to remain unnamed, said IFIC Bank shares were still paper-based and needed to be converted into market lot.
"Shares of IFIC Bank need to be divided into market lot. If the government decides to demat (dematerialise) the shares through CDBL, it will be possible to automatically convert them", he said.
"We have already informed the government of the matter", he added.
The official failed to say when the shares would hit the market. "It depends on how fast the government moves", he said.
IFIC Bank was listed on the stock market in 1986 with a total of 40,63,861 shares. The book value of each share at Tk 100.
According to the Dhaka Stock Exchange, sponsor-shareholders of the bank hold 34 per cent stakes while general or public holdings account for 31 per cent shares of the bank.
Shares of the bank are now traded as Z or low-quality shares due to its failure to hold annual general meetings (AGMs) for three years since 2003 because of a legal wrangle in the court.
The High Court, however, has ordered the bank to hold pending AGMs. Following the court directive, it posted 30 per cent stock dividends for three years since 2003.
The bank also announced 24 per cent stock dividend for 2006.
The IFIC Bank, with a total share capital of Tk 406 million, also received permission from the central bank to raise its authorised capital to Tk 1.6 billion from Tk 500 million.