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Trial trading of govt securities starts, but no trade executed

FE REPORT | October 11, 2022 00:00:00

The trial trading of 250 government securities began on both the stock exchanges of the country on Monday.

However, no trade was executed due to a complexity that barred transfer of the securities into the investors' BO (beneficiary owner's) accounts.

"Buyers are ready to buy and hopefully trades will be executed tomorrow (Tuesday)," said M Shaifur Rahman Mazumder, managing director (current charge) of Dhaka Stock Exchange (DSE).

Another DSE official said trading of the bonds went live on Monday after completion of the re-listing of 250 bonds.

"The units of the bonds are kept in the Business Partner Identification (BP ID) number maintained by the central bank. The units need to be transferred into investors' BO accounts to execute the trading," he said.

He also said the central bank has become aware of the connectivity problem and trades are likely to be executed from Tuesday.

According to the securities' regulator's information, the face value of the government bond is Tk 100 and the market lot consists of 1000 bonds, meaning the investor will have to invest at least Tk 100,000 to take part in transactions.

A seller of the bond will get the sale price along with accrued interest and the buyer will get the money coupon which will be deposited into his bank account though BEFTN (Bangladesh Electronic Funds Transfer Network), said the securities regulator.

It said investors' portfolios will be diversified through investments made in risk-free government securities.

Earlier, the trading in government securities was supposed to start on August 16 last in line with an instruction of the securities regulator. But the exchanges were not able to commence the trading as some preparations remained incomplete.

Stakeholders such as Bangladesh Bank (BB), Bangladesh Securities and Exchange Commission (BSEC), both the bourses and the depository authority, CDBL, signed a memorandum of understanding (MoU) on June 12 last on trading of the government securities such as T-Bonds in the secondary market.

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