New exchange board mulled for delisted, small-caps, new products
22 July, 2018
The stock market regulator plans to set up an alternative trading board at the exchanges to facilitate the trading of securities of delisted and very small-cap companies as well as the entry of new products.
The ATB will replace the over the counter (OTC) market, where the shares of delisted companies are traded now.
A board for small-cap companies will be set up soon. The companies that will still not be eligible for being traded on the small-cap board will get an opportunity to have their shares changing hands on the ATB.
The ATB will be capable of trading any equities, corporate bonds, derivatives and open-end mutual funds.
The regulator has drafted the Bangladesh Securities and Exchange Commission (ATB) Rules, 2018 and published it recently seeking public opinion.
Officials of the BSEC said the planned board would boost product diversification and increase investor connection to the board through stock brokers. According to the draft rules, purchase or sale of securities at the ATB will be carried out through a stock dealer or broker of an exchange.
The exchange will display through designated counter or computerised system a full list of the securities available on the ATB, the quantity of a security open for trade and the unit price offered by a seller or buyer.
The exchange or the commission may discontinue, halt or suspend the purchase or sale of a security, if it is deemed to be proper in the interest of investors and the capital market, after giving an opportunity of being heard to the issuer concerned, according to the draft rules.
Officials said new products could be traded on the platform as there will not be any minimum or maximum paid-up capital requirement and the companies would not require making quarterly earning disclosures.
However, the exchanges will determine the requirements related to reporting, disclosure and information.
According to the draft rules, issuers will apply to the stock exchanges rather than the BSEC seeking permission to trade a share on the ATB. Issuers may appoint merchant banks to submit application.
The ATB will speed up the listing of a company, as exchanges will have to accept or reject the application within 30 working days after an application is received.
Presently, it takes more than a year for a company to go public in Bangladesh.
Exchanges will also determine fees, commissions and charges for trading.
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