Share market requires strict surveillance and authority

After changes in the regulatory body BSEC, the reforms and initiatives instilled a degree of stability in the share market. Transactions have also increased along with the index. It seems investors' confidence has increased in this market that had been stagnating.

After nearly a decade, the market is now easing. One of the reasons is the change in the regulatory body, the Securities and Exchange Commission. If the progress was caused due to the change, naturally question arises as to why the person in whom the investors had no trust, remained chairman of the SEC for 9 years?

It is very clear that during the term of the former chairman Khairul Haque, the distrust of the investors, the rumours surrounding him and his incompetence led to the collapse of the sector. If millions of investors are harmed because of him, he and the government as cannot avoid their liability.

The economy is slowly recovering in the post-pandemic period, with the stock market also emerging from a vicious cycle. At the beginning of last July, the market capital of the Dhaka Stock Exchange (DSE) was Tk 3.11 trillion, now it is around Tk 3.95 trillion. The main index of DSE is is broadly close to five thousand, the transaction now Tk 8 to 12 billion.

After taking charge, BSEC chairman Shibli Rubaiyat-ul-Islam has promised to establish good governance in the capital market and has taken some steps. The strict rules imposed on the shares of directors has yielded positive results. There have been attempts to bring new companies into the market, although the process of pricing IPOs is not yet free from question.

Lack of investment due to coronavirus outbreak has already led to idle money in the capital market, black money has been given the opportunity to be invested, interest rates on bank loans and deposits have come down. Institutional investment came up in many ways. As a result of various steps taken by the government, the liquidity crisis has been alleviated.

However, even in this situation, those involved in market manipulation have not stopped. Investors are seeing the manipulation, too. In the stock market, the share price of some insurance companies has doubled, tripled, quadrupled, which is not at all normal according capital market experts. Although the share price of weak companies has risen abnormally, the silence of the regulatory body is being questioned. The institution needs to keep a close eye on the market so that no party can benefit from foul play.

The experience of the capital market in Bangladesh is the intervention of government institutions or agencies and attempts to control the index, which is unwarranted. Because when a market is attempting to rise, it will not bring long-term benefit it pulled up or controlled. The market must now be allowed to run on its own.

It is also the main responsibility of the regulator to protect the interests of investors. If someone invests in the stock market without understanding it, that person has to take the responsibility. But if someone goes to this market and falls victim to fraud, that is the responsibility of the commission, for which the investors have to be warned.

The difference between the powers of the SEC and the other bodies is that the commission can make its own rules. It has semi-judicial powers. The government has many commissions which are powerless. But SEC has a lot of power and stakeholders want to see a fair exercise of its power. The stock market will play a big role in development if its laws and power are applied impartially and this market is allowed to run at its own pace.