DSE submits draft demutualisation act to SEC, finance ministryStaff Correspondent
The Dhaka Stock Exchange on Sunday submitted the draft demutualisation act to the Securities and Exchange Commission and the finance ministry.
The DSE president Rakibur Rahman and all its board members on Sunday morning submitted the draft act on demutualisation to SEC chairman M Khairul Hossain.
Later on the same day, a DSE delegation submitted a copy of the draft to banking division secretary Shafiqur Rahman.
Last week, DSE finalised the draft act at its board meeting.
Demutualisation means separating the ownership of a stock exchange from its management to do away with the conflict of interests.
In its concept paper, the DSE suggested the government to enact a law for demutualisation. Local and foreign consultants should be appointed to finalise the demutualisation act, the paper said.
The act will define the separation process of Dhaka Stock Exchange owners from its management and also set trading right criteria.
After passage of the act, the DSE would get listed as a company on the stock exchange and a portion of its shares would be tradable.
One portion of the DSE shares would be sold to institutions for strategic purposes. In public holdings, no single shareholder can hold more than 5 per cent of the total shares, according to the concept paper.
It also suggested a provision for allowing stock exchanges of other countries to buy DSE shares.
At present, member brokerage houses of the DSE are owners and their elected representatives are members on the board of directors.
So if the DSE board takes a decision, it might create a conflict between the interest of brokers and investors.
The finance ministry last week asked the Dhaka and the Chittagong stock exchanges to submit conceptual frameworks for the demutualisation by December 30, the officials said.
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