IPO application process to be reduced to around 43 days

The securities regulator is on the way to introduce its guideline formulated to reduce investors' hassles by lessening the IPO (initial public offering) application process and time significantly, officials said.    
According to the fresh guideline formulated by the Bangladesh Securities and Exchange Commission (BSEC), the duration of the IPO application process will be reduced to around 43 days instead of existing 75 days.
"The securities regulator has exchanged its views on the proposed IPO process with the merchant bankers and stockbrokers. The guideline is likely come into effect soon through the issuance of a directive," said a BSEC official.
As per the proposed BSEC guideline, the IPO seekers need not to stand in long queue of bank counters as the process will be completed through the stock brokers who maintain the BO (beneficiary owner's) accounts.
An applicant will submit the application for securities of public issue within the cut-off date, which will be the 25th working day from the date of publication of abridged version of prospectus.
The application may be submitted in prescribed paper or electronic form or telephonic order followed by written confirmation.
In that case, the stock brokers will have to confirm that the applicant has required money against his IPO application without any margin facility and deferred payment.
After verifying the application and allocating all applicants' money, the stock broker will deposit the amount to 'Consolidated Customer Account' maintained with banks.
The banker shall block the account(s) and issue a certificate to the stock broker confirming the same.
The stock brokers will have to prepare a list of the applicants with all particulars available in CDBL data base and within three working days from the cut-off date will send the list to the issuer both in electronic and printed format.
Within next eight working days, the issuer and issue manager jointly will prepare a consolidated list of the valid and invalid applications and submit the report of final status of subscription to the commission and stock exchanges.
The issuer and issue manager will conduct the lottery within three working days of reporting to the commission, if they receive no observation from the commission and exchanges.
Within two working days of conducting the lottery, the issuer and issue manager will inform the stock brokers about the successful and unsuccessful applicants and request to release the amount the blocked for unsuccessful applicants.
On the next working day of receiving the documents from the issuer and issue manager, the stock brokers will remit the aggregate amount of successful applicants to 'Escrow' account opened for subscription purpose.
Finally, on the next working day of receiving request from the stock brokers, the successful applicants will be informed of allotment of securities and issue allotment letters.
The duration and completion of application process for the non-resident Bangladeshis and foreign investors are almost the same.
In that the authorised dealer (AD) banks, where applicants maintain foreign currency accounts, will play the key role.
When asked, the president of Dhaka Stock Exchange (DSE) Ahasanul Islam Titu said the application process will be easier through the brokerage firms instead of the bank terminals.
"The process will be completed through around 40 thousand terminals of the exchanges' members whereas presently the process is completed through more than 40 terminals. That's why the proposed process will reduce investors' hassles," said the DSE president.