Merchant banks to enjoy provision exemption for two more years
Merchant banks will enjoy two more years of exemption from provisioning against portfolio losses, said the securities regulator.
A press release by the Bangladesh Securities and Exchange Commission (BSEC) said on Wednesday that based on an application of Bangladesh Merchant Bankers Association, the commission extended the exemption period for another two years.
Due to stock market fall, like all other market intermediaries, the merchant banks are also suffering a huge loss both on their own and clients' investment portfolios.
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There is an obligation for the regulated institutional investors to set aside a certain portion of their profit, proportionate to the losses in investment portfolio that increase the firms' resilience.
But most of the intermediaries have been seeking for exemptions to keep their current profit and loss accounts stronger and the regulator is allowing them considering the extreme market adversity.
