Central Counterparty Bangladesh Limited (CCBL) has rejected the Dhaka Stock Exchange's (DSE) request to suspend procurement activities, saying the request is legally invalid.
On December 10, the prime bourse, which owns a 45% stake in CCBL, expressed concerns over CCBL's procurement initiatives and called for suspension.
In response to the letter, CCBL said that the suspension request was not "legally tenable".
CCBL is an independent organisation, it said. To ensure independence of CCBL, a majority of its directors are independent (seven out of thirteen), whose appointments are approved by the securities regulator.
Moreover, other shareholders, which jointly hold 55% stake in CCBL, have not raised similar concerns over procurement.
"You cannot order another organisation to halt its major operations. Though the DSE is a major shareholder, it's not the controlling shareholder," said a high official of CCBL.
In a letter issued earlier, the DSE expressed concerns that CCBL had failed to safeguard the country's best interests by exposing critical technology to external vulnerabilities and by being slow in implementing key decisions.
It also asked CCBL to refrain from acquiring additional IT facilities for transactions settlement, suggesting that CCBL instead should utilise the existing infrastructure of the DSE.
Established in 2019, CCBL aims to modernize the infrastructure of Bangladesh's capital market by introducing derivative products and advanced clearing and settlement systems.
The DSE criticized CCBL for a lack of communication and interaction, noting that CCBL has not shared any financial statements with the DSE.
In its reply, CCBL says that out of a delay of 955 days, CCBL or DSE did not have any control over the delay of 535 days, the time taken for the formation of the first board of CCBL.
After the constitution of the first board, 302 more days were wasted due to reasons associated with the DSE.
CCBL also rejects the idea of sharing the same facility for data storage for that will cause enhanced risks; if the DSE fails, CCBL will also fail.
CCBL also rejects the criticism of miscommunication, saying 63 board meetings and innumerable committee meetings had been held at CCBL where DSE nominated directors attended.
No meeting of CCBL has ever been held without participation of DSE nominated directors, it says.
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