The DSE Brokers Association (DBA) of Bangladesh placed a 30-point demand, including a massive overhaul of the securities regulator and immediate removal of corrupt officials to ensure good governance.
The past two chairmen of the Bangladesh Securities and Exchange Commission (BSEC) failed to ensure transparency and accountability in the market. They were politically appointed and made decisions along the line of political aspirations, not for the interest of investors.
The institutional framework of the securities regulator has been completely destroyed over the past 14 years to the benefit of a handful of people close to the government at the expense of millions of investors.
"Their unprofessional and unethical activities during their tenure kept the market from growing," said Saiful Islam, president of the DBA at a press briefing on Monday.
The DBA is a platform of trading right entitlement certificate (TREC) holders of the DSE. It held the press briefing at Dhaka Club two days after Prof Shibli Rubayat-Ul Islam stepped down from the position of chairman of the BSEC amid widespread criticism about his performance.
The DBA president said the BSEC must be restructured through the appointment of honest and capable persons for the positions of chairman and commissioners, who would not have any political bias and have experience relevant for the jobs.
"No appointment shall be made on political grounds," said Mr Islam, adding that a "search committee" should be formed for the hiring of qualified persons.
Without giving importance to the development of the basic structure of the market, the two commissions accepted flawed IPO proposals and allowed placement share business to the detriment of the market, said the DBA chief.
During the regimes of the previous two chairmen of the BSEC, the regulatory body catered to a vested quarter while the market gradually turned into the worst place for investment. Both local and foreign investors shunned the market as they saw its deterioration over time.
A statutory power called 2CC has been given to protect the interests of investors. Unfortunately, the past two commissions arbitrarily misused 2CC in favour of vested interests and market manipulation, said Mr Islam.
According to the Securities and Exchange Ordinance, 1969, 2CC is a special power of the BSEC, which empowered the securities regulator to decide anything for the sake of the capital market's development and to protect investors' interest.
The DBA chief demanded a review of the rules and regulations formulated by the past two commissions.
The DBA president also said the chairman and commissioners should be separated from the executive department by giving them the highest power so that they can take decisions independently.
There were many unscrupulous investors in the market, who leveraged good relations with the top officials of the commission for their own benefits, said Mr Islam.
"To bring back investors' confidence in the capital market, legal actions against those corrupt officials should be taken upon investigations," said Mr Islam.
The DBA also demanded an overhaul of the board of the Dhaka Stock Exchange, the Chittagong Stock Exchange, the Central Depository Bangladesh and Central Counterparty Bangladesh as politically-appointed directors are still there.
The DBA also demanded amendments to the Public Issue Rules-2015 to ensure transparency in the IPO and rights issue process. The stock exchanges should be empowered to suspend or delist any listed company in case of serious violation of listing laws, it said.
The bourses should also have power to independently inspect whether the listed companies are actually running or not. Closed companies should not be allowed to trade shares in the secondary market.
The last two commissions destroyed the mutual fund sector by handing it over to dishonest individuals, the DBA said.
"Investigate those who destroyed the sector and ensure appropriate punishment and hand over the management of funds to genuine professional fund managers," said the DBA president.
For the sake of the development of the stock market, an effective and active advisory council should be formed, consisting of eminent persons from different sectors.
"The advisory council will meet every month and will monitor the overall activities of the commission and give suggestions for the development of the market," said Mr Islam.
The Shibli-led Commission held more than a dozen roadshows abroad on the pretext of attracting foreign investments. Instead of bringing in new investments, the roadshows cost huge amounts of foreign currency, said Mr Islam.
"We demand the publication of the white paper of each roadshow and the public disclosure of how much money was spent and what has been achieved," said the DBA president.
Mr Islam said he believed the interim government would work to build a corruption-free, prosperous country by ensuring good governance at all levels.
"We are ready to give all kinds of support to this government," said Mr Islam.
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