SEC and small shareholders

---

The Securities and Exchange Commission (SEC) is the only regulatory body of the capital market. The main function of the body is to protect the interest of the investors.
The SEC verifies many factors related to the capital market and then allows floating of shares to raise equity funds. In our country there are many big companies, both in the public and private sectors, which are not listed. In our original Constitution socialism was one of the fundamental principles. The purpose was that the members of the public would be owners of state-owned enterprises.
The government still owns the majority shares in a large number of public sector enterprises. This is not fair. Many of these enterprises, particularly in the energy sector and jute and textile sectors, often approach banks for funds to run their businesses as well as for payment of salaries. If shares of the companies were off-loaded in the capital market the banks would have got some relief.
I feel sorry when I look at the Bangladesh Railways and Postal Department. Both the government departments were doing very well in the British period. The Railways has vast landed-property and wealth throughout the country. There were post offices even in the remote corners of the country. Both the Railways and Post Offices can be revitalised by handing those over to the private sector. The SEC has never thought of introducing anything new, which could play a vital role in the economy. The SEC has kept its functions limited to only regulation of the market and fixing fines for disobeying its rules.
The SEC has to think about the retail investors, too. During the 1990s many small companies floated IPOs and distributed the shares proportionately. As a result many applicants received fragmented shares. Now the shareholders cannot sell those old lots. Again some of the companies have court cases against them. But these companies are not holding Annual General Meeting (AGM) for consecutive 3 to 4 years. The cash dividend or bonus shares are lying locked up and earning nothing. The shareholders are the worst sufferers. Even the Investment Corporation of Bangladesh (ICB) unit certificate holders do not get their dividend within 3 to 4 months of the AGM. The small shareholders buy the shares as the rates of interest of government savings tools have been reduced. But the small shareholders interests are not properly looked after by the SEC. Can the SEC not take up the matter with the ministry of law to dispose of the court cases quickly?

Mahbubul Haque Chowdhury
Lake Circus, Kalabaghan
Dhaka-1205