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BSEC working to ensure transparency in MF sector: seminar

FE REPORT | October 04, 2023 00:00:00

The Bangladesh Securities and Exchange Commission (BSEC) is working to ensure transparency and accountability in the mutual fund sector.

"The commission is strict in ensuring compliance with accounting standards to restore investors' confidence in the mutual fund sector," said Dr. Mizanur Rahman, one of the commissioners of the securities regulator at a seminar on Tuesday.

He attended the programme titled Role of SDG Analytics in Capital Market-Based Development Financing as chief guest. The Association of Asset Management Companies and Mutual Funds organised the seminar in the capital on the occasion of "World Investor Week-2023".

Presently, the size of the mutual fund sector in Bangladesh is Tk 160 billion, very low compared to neighboring countries, said Mr Rahman, adding that the industry should be at least 10 times bigger.

However, he expressed the hope that the sector will develop significantly in the next 10 years as the commission is working on it.

Dr. Shaikh Shamsuddin Ahmed, another commissioner of the BSEC, was present as guest of honor, while Dr Hasan Imam, president of the association and group chairman of Race Management presided over the event.

Zubayer Hossen, coordinator and economist-UNDP Bangladesh, presented the keynote paper and Mohammad Rezaul Karim, executive director of the BSEC, was present as special guest.

Mr Shamsuddin Ahmed urged people to invest in mutual funds to reduce the investment risk.

Dr. Hasan Imam said mutual funds were the largest institutional investors in the stock market.

The stock market was negative in the last financial year. The blue chip companies where mutual funds invest more, performed poorly.

"Despite this situation, the fund managers paid cash dividends worth Tk 2.83 billion in FY23. The mutual fund sector has even outperformed the index in 7 out of the last 10 years," said Mr Imam.

Referring to criticisms over lower unit price of mutual funds, Mr Imam said it did not bear any sign of the performance of asset managers.

Most of the mutual funds trade at prices lower than the face value. "You have to see the value of assets of mutual funds, not the unit price."

Mr Imam said the dividend yield of mutual funds was 15 per cent to 20 per cent, which was not possible in other sectors of the stock market.

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