SEC interventions
The security exchange commission has taken the following decisions in the recent past.
1. On 11 July, the margin loan ratio was reduced to 1:1 from 1:1.5. On the next day the general index fell by 128 points.
2. On 14 July, SEC wanted on an emergency basis the list of 50 top investors from Brokerage Houses and Merchant Banks. The General index fell by 76 points on the next day.
3. On 22nd July, SEC directed the merchant banks to give up to Tk 10 crore and brokerage houses up to Tk 5 crore as loan to a BO account holder.
Lately, SEC is endeavouring to enforce another complicated devilish margin rule loan regulation which all the stakeholders strongly objected to and resented.
Prior to the above decisions, the margin loan criterion had been altered from PE75 to PE50 and then again from PE50 to PE40.
The central bank has started poking its nose once again into the share market. The reasons given behind all the above apparently innocuous decisions by the SEC are that the market is overheated, many shares are over priced, investors are ignorant etc. An investor can rightfully ask the SEC what is the harm if the general index goes up. The market and the general index are not supposed to remain frozen at year 2000 level! The country will develop, so will the activities, investments and index of the share market. What is the rationale behind 'crying wolf', 'false alarm', 'impending dooms day' every now and then , resulting in panic sale, unsettling the budding market?
All the above mentioned decisions were taken in the names of small investors to protect their interest. Ironically, the decisions actually harmed and killed many small share investors! It appears that Muhammad bin Tuglak has not died ! The 'reign of Tuglak' is prevailing in SEC. If SEC intervenes three times in a month and harms the investors, should they not be taken to task, reprimanded, asked to refrain from such 'knee jerk reactions', improve their qualities, and on failure be punished for their inefficiency and apathy for the common people who constitute the majority of the population of Bangladesh? Nobody is above law.
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