Chattogram bourse to revoke 11 new brokerage licences
On Tuesday, the BSEC gave its consent to the port-city bourse in this regard
The Chittagong Stock Exchange (CSE) is to rescind 11 of the 26 newly issued brokerage licences – known as trading right entitlement certificates (Trec) – as the firms did not comply with relevant rules and regulations.
The firms are Bridge Stock & Brokerage, Shah Mohammad Sagir & Co, Beximco Securities, Merchant Securities, SBAC Bank Securities, Columbia shares & Securities, Biplob Holdings, Benemoy Securities, B & Bss Trade International, Matrix Securities, and DP7 Ltd.
Of them, Shah Mohammad Sagir & Co, Beximco Securities, and Merchant Securities are also members of the Dhaka Stock Exchange (DSE).
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On Tuesday, the Bangladesh Securities and Exchange Commission (BSEC) gave its consent to the port-city bourse in this regard.
In November 2021, the commission approved 26 applications for new Trec of the CSE, subject to the fulfilment of some compliance criteria, including minimum paid-up capital, registration fees, and security deposits.
Of them, 15 firms have completed the formalities and deposited the required registration fees and security money while 11 others did not fulfil the CSE Trec requirements, according to the CSE.
Md Ghulam Faruque, managing director (in-charge) at CSE, told The Business Standard that the board decided to cancel 11 applications for their failure to comply with the rules.
"We applied to the commission for approval in this regard," he said.
The CSE will close the files of brokerage licences once they receive an approval letter from the commission, adding the port city bourse has a plan to issue 40 more Trec this year.
Eligibility for getting new Trec
Any firm or statutory body can apply for Trec subject to the commission's approval.
The minimum paid-up capital of the firm will be Tk5 crore from a local firm, Tk8 crore for a joint venture firm – local and foreign – while Tk10 crore will be for a foreign firm.
The audited net asset will be a minimum of 75% more of its paid-up capital.
The minimum-security money will be Tk3 crore for a local firm, Tk4 crore for a joint venture firm and Tk5 crore for a foreign firm. The funds will remain deposited with the CSE.
There are 250 brokerage firms at the Dhaka Stock Exchange and 148 in the Chittagong Stock Exchange providing brokerage services to their customers.
Last year, the regulator also approved more than 52 brokerage licences for the DSE.
