No utilisation of 29.0pc of fund

About 28.65 per cent of the Tk 9.0-billion capital market refinancing fund remains unutilised due to poor response from the investors, affected during the 2010-11 stock market debacle, officials said.
Despite repeated attempts the fund supervision committee and Investment Corporation of Bangladesh (ICB) could not disburse over Tk 2.56 billion of the affected small investors' assistance fund, an ICB official said.
"We are trying to disburse rest of the fund under the scheme, as the government has extended time for obtaining loan from it," he added.
The timeframe has been extended by one more year, until December 2017, for smooth implementation of the incentive package. Earlier, the scheme was set to end in December 2016.
In June, the government also reduced the fund's interest rate by 1.5 per cent. At present, the interest rate is 7.5 per cent, which was 9.0 per cent.
Meanwhile, loans amounting to Tk 297.20 million were sanctioned in favour of 751 small investors of seven merchant banks and broker houses. But they did not come forward to take the loan, the officials also said.    
ICB Managing Director Md. Iftikhar-uz-zaman in a recent letter informed the fund's update to the Ministry of Finance (MoF).
Bangladesh Securities and Exchange Commission (BSEC) Executive Director Md. Saifur Rahman told the FE on Wednesday: "Some portion of the fund under the capital market refinancing scheme could not be disbursed due to different reasons. We are trying and taking new initiatives to disburse it."
Besides, the application period for obtaining loan under the scheme has been extended to March 31, 2017 from December 2016, he added.
The government formed the Tk 9.0-billion fund in July 2013 to prop up the capital market, and mitigate the sufferings of investors, affected during the 2010-11 stock market debacle. Later, ICB was appointed as the fund manager.
The central bank disbursed Tk 9.0 billion in three instalments against the fund. Until May 15 this year, the merchant banks and stockbrokers have disbursed Tk 6.42 billion to 25,262 affected small investors.
The fund has already realised Tk 5.50 billion with interest of loans from the borrowers.
Before disbursing the fund, BSEC identified some 954,000 investors, who are eligible to avail of the facility, in line with the guidelines set for the capital market refinancing scheme.
The affected investors, who invested up to Tk 1.0 million during the period between January 2009 and November 2011, were eligible to get loan under the scheme.
In August 2013 the state-run ICB received Tk 3.0 billion as the first instalment of the refinancing scheme from the central bank. Later, the rest Tk 6.0 billion was disbursed in two more instalments.
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