The ATB provides for the inclusion of unlisted securities such as: shares of unlisted companies, bonds, debentures, sukuk, open-end mutual funds, and alternative investment funds subject to the prescribed conditions
Md Mahbubul Alam, executive director of the Bangladesh Securities and Exchange Commission (BSEC), has called for reducing the brokerage commission, listing fee and central depository charges for securities listed on the alternative trading board (ATB).
Mentioning that security, liquidity and growth are most important for investment, he said it is better not to encourage small investors to invest in ATB securities.
"The reason is that the amount of risk in debt and equity securities listed on the ATB is much higher than the securities listed on the mainboard. And because of the high investment risk on this board, only large investors should be encouraged to invest here," Alam added.
He was speaking at a programme on "Activities and Prospects of the Alternative Trading Board" jointly organised by the Bangladesh Academy for Securities Market (BASM) and the DSE Training Academy on Tuesday.
Representatives from the BSEC, Dhaka Stock Exchange, Chittagong Stock Exchange, different merchant banks, issuers, and the Central Depository Bangladesh Ltd (CDBL) attended the programme.
Mohammad Rezaul Karim, director of BSEC and additional director general of BASM, presented the keynote address at the training programme.
ATB provides for the inclusion of unlisted securities such as: shares of unlisted companies, bonds, debentures, sukuk, open-end mutual funds, and alternative investment funds subject to the prescribed conditions.
A sukuk is an Islamic financial certificate, similar to a bond, which complies with Islamic religious law commonly known as Sharia.
Saifur Rahman Majumder, chief operating officer of the DSE, elaborated on the eligibility for listing, application process, sale and purchase of securities and prospects on the ATB.
He said, as per regulations, the alternative trading board can apply to the exchange in a specific form for listed securities or delisted securities to avail business benefits. The exchange will accept or reject such applications within 30 working days.
He added that if the ATB is effective, the participation of the capital market in GDP, the revenue of the exchange and the government revenue will increase.
It will also ensure the visibility of institutions and corporate governance practices, and thus foreign investment will increase.
Sharif Anwar Hossain, president of the DSE Brokers Association of Bangladesh, said in different capital markets around the world, there is a big opportunity to create alternative markets outside the existing equity markets.
"However, there is an opportunity to increase the transactions and profits of the exchange. There are currently more than one lakh registered companies in Bangladesh, which have no platform for share pricing and transactions. Shares of these companies can be traded on the alternative trading board," he added.
CDBL Managing Director Shuvrokanti Chowdhury, FCA, said the ATB is a timely step towards developing the capital market.
He said due to the novel coronavirus pandemic, the country's economy is likely to slow down along with the rest of the world's economies.
"The way out of this recession is to increase the production of small and medium companies by providing incentives. Many small companies in the country are doing good business. Once these companies are listed on ATB, investors will have the opportunity to invest in quality companies," he added.