Securities regulator to restructure ICB

The Bangladesh Securities and Exchange Commission (BSEC) has recently announced that it will restructure the Investment Corporation of Bangladesh (ICB) - the state-owned investment institution for the capital market. 

The announcement was made in a dialogue programme organised by the Chittagong Stock Exchange on Saturday. 

Professor Shibli Rubayat Ul Islam, chairman of BSEC said, "We recently appointed a foreign advisory institution to restructure the ICB. We are seeking the advisory report from the foreign institution within November this year."

"The restructuring decision has been taken to strengthen the ICB's ability to support the capital market properly," he added.

Speaking on the occasion, Md Abul Hossain, managing director of ICB said, "Since 2010, ICB has been supporting the capital market through the Bangladesh fund and its own fund without considering its own interests." 

"But in the last few years, indices of the stock exchanges have faced continuous fall. In this situation, ICB took a loan of Tk11,000 crore from various banks and institutions at high interest rates to support the market. As a result, cost of funds have increased and hence we have to sell shares to repay the loan. Therefore, ICB has no ability to support the dull stock market."

He further added that so far, ICB has been repaying the huge interest on loan quarterly. Now, it needs to extend the tenure of those loans to be able to pay the interest for at least one year.

From January to March this year, the DSEX fell by 10 percent to 4,008 points amid the Covid-19 pandemic.

During this period, ICB made a consolidated net profit of Tk102.34 crore as compared to Tk25.49 crore during the same period in the previous year. 

Its earnings per share (EPS) was Tk1.33, up from Tk0.33 during the same time in the previous year.

Although the state-owned company made huge profits, it was still facing a loss of Tk47.81 crore in the first three quarters of the last financial year. Its loss per share was Tk0.62.

The net asset value per share stood at Tk2.61 during this period, which was lower than that of the first three quarters of the previous year.

In the 2018-19 fiscal year, the net asset value per share was Tk40.52.