Dhaka, Bangladesh (BBN) – Bangladesh’s prime bourse has sought low-cost funds through a financial stimulus package to help offsetting operational expenses of brokerage houses and merchant banks amid the Covid-19 pandemic.
A four-member delegation of the Dhaka Stock Exchange (DSE) Limited board of directors, led by its chairman Md. Eunusur Rahman, put forward the request at a meeting at Bangladesh Bank (BB) headquarters in the city on Tuesday, with Governor Fazle Kabir in the chair.
The central bank advised the DSE delegation to seek the support from the Ministry of Finance (MoF), meeting sources confirmed.
Shakil Rizvi, a director of the DSE, reportedly said they will soon submit a proposal to the MoF.
The central bank may provide a refinancing facility if the government announces a stimulus package for offsetting the adverse impact of the Covid-19 on their businesses, according to a BB senior official.
The DSE delegation also sought interest waiver on margin loans provided by the merchant banks and brokerage houses for six months to minimise the losses of the market participants, they added.
The amount of such loans would be around Tk 15 billion.
The central bank advised the delegation to discuss the issue with the Bangladesh Securities and Exchange Commission (BSEC).
The meeting also discussed different other issues, including starting trade of the government securities at the DSE.
The central bank along with Tata Consultancy Services (TCS) is now working to modify the market infrastructure (MI) module, an automated trading platform, to facilitate trading of the government securities in the country’s prime bourse.
“We’ll sign a non-disclosure agreement with the DSE shortly as part of starting trade of the government securities in the prime bourse,” the central banker explained.
A tripartite committee with representation from the BB, the BSEC and the DSE has already submitted its recommendations in this regard to the authorities concerned.
Currently, three T-bills are being transacted through auctions to adjust the government borrowings from the banking system. The T-bills have 91-day, 182-day and 364-day maturity periods.
Furthermore, five government bonds with tenures of 02, 05, 10, 15 and 20 years respectively are traded on the money market.