Leaders of the DSE Brokers Association (DBA) on Saturday expressed frustration over the Bangladesh Securities and Exchange Commission鈥檚 (BSEC) inaction, even after the major political shift on August 5.
They said the commission has become practically non-functional, with no visible reforms or tangible progress in recent months.
The top 10 stock brokers organized a meeting at the Dhaka Club on Saturday where that said that the capital market is being neglected from all sides, including the government. They pointed to the absence of stock market representation at a recent high-profile Investment Summit as a sign of how far the sector has been sidelined.
DBA president Saiful Islam said that the number of Beneficiary Owner (BO) accounts has dropped to 1.2 million from 3.2 million in the last decade, while daily turnover still hovers around Tk 500 crore鈥攆ar below expectations given the country鈥檚 economic growth.
On top of that the regulatory bodies have imposed numerous barriers instead of supporting market development, he said.
All speakers identified advance income tax (AIT) as a major problem. Currently, brokers must pay Tk 50 in AIT for every Tk 100,000 in transactions. In contrast, the annual rate is only Tk 10 in India, 65 paisa in Pakistan, and Tk 7 in Singapore.
They stressed that this tax is non-adjustable and treated as final, meaning brokers pay taxes even in years of financial losses, senior vice president Md. Saifuddin noted.
聽鈥楴o other country imposes non-adjustable taxes like this,鈥� he said. Paying taxes despite losses for 15 years is unjust, he said.
They said BSEC has failed to bring any strong-performing company to the market since Grameenphone, and that investors鈥� confidence continues to erode. Most brokerage firms are now facing operating losses and are struggling to survive.
According to the brokers, instead of supporting capital market growth, the government and regulators have imposed barriers that have suppressed its development鈥攗nlike in other economies where capital markets are vital for financing and growth.
They also criticized BSEC for not consulting with key stakeholders, such as intermediaries and high-net-worth investors, when introducing reforms.
DBA also questioned the credibility of the current BSEC taskforce, saying it includes inexperienced individuals. A focus group was formed without any engagement with the broker community, and its members鈥� qualifications are questionable, they added.
While the regulatory responsibilities rest with BSEC, it is now shifting its duties to the finance ministry, the brokers alleged. This, they said, is pushing the capital market backwards by 50 years.
They noted that not a single IPO is pending at the commission in the last eight months鈥攁n unusual situation globally鈥攊ndicating a lack of new product supply in the market.
BLI Securities managing director Minhaz Mannan Emon, Shakil Rizvi Stock managing director Shakil Rizvi, and Lanka Bangla Securities managing director Mohammed Nasir Uddin Chowdhury also spoke at the event.
