Perpetual bond not to come into capital market exposure
Emphasising introducing a new product for both the capital and the money market, BSEC chairman said currency hedging should be introduced as the forex reserve is now high.
The capital raised through perpetual bonds will not be calculated as capital market exposure for banks after such an instrument gets listed on the stock market.
Shibli Rubayat Ul Islam, chairman of the Bangladesh Securities and Exchange Commission (BSEC), said adding, "I want to assure that it will not be calculated as capital market exposure as raising such capital has been allowed to help banks."
If such capital is calculated as capital market exposure that will not help banks eventually, he said while addressing the subscription closing ceremony of perpetual bonds, organised by the City Bank on Tuesday.
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"We discussed the issue with the central bank and they also assured that it will not be calculated as capital market exposure," Shibli Rubayat said.
He said the city bank is going to be the first to get its perpetual bonds listed on the stock market. The exit policy will help investors get higher profits from such an investment.
Emphasising introducing a new product for both the capital and the money market, the BSEC chairman said currency hedging should be introduced as the forex reserve is now high.
Mentionable that the BSEC have decided that perpetual bonds issued by banks must be listed on the stock exchanges within 30 days of their subscription closure.
Salman F Rahman, prime minister's private industry and investment adviser, through videoconferencing said exit policy will make the bond attractive to investors.
The inclusion of such a new instrument in the capital market will help the market grow in line with GDP growth.
Mashrur Arefin, managing director of the City Bank, said the listing process of perpetual bonds on the exchanges has started conforming to the BSEC directive.
The bond will be a great investment opportunity for investors due to the high-interest return, he added.
Ahmed Jamal, deputy governor of Bangladesh Bank, Aziz Al Kaiser, chairman of City Bank and Aziz Al Mahmood, chairman of City Bank Capital Resources Limited were also attended at the event along with many prominent senior officials from the financial industry.
