Unpaid IPO Fund, Right Shares Should Be Sent to BSEC’s Market Stabilization Fund

The Bangladesh Securities and Exchange Commission has asked listed companies to send unpaid public subscription fees and rights shares to their capital market stabilization fund in addition to unclaimed cash and stock dividend.

The BSEC has issued a notice to this effect, which was published as an official gazette on 27 June.

The Capital Market Stabilization Fund must be a perpetual fund in order to function as a custodian of undistributed or unclaimed or unsettled dividends (cash or stock) or unallocated rights shares or unredeemed public subscription money for the benefit of the shareholders or shareholders or investors the rules said.

“All unpaid or unclaimed or unsettled cash dividends, unredeemed public subscription monies, stock dividend or rights shares, must be transferred to the BSEC’s Capital Market Stabilization Fund within three years from the date of declaration or approval or subscription,” the rules said. .

Earlier on January 14, the BSEC issued a directive stating that any amount of cash or stock dividend that remains unpaid or unclaimed or unsettled, including accrued interest income, must be paid within three years from the date of declaration or approval. transferred to the BSEC Capital Market Stabilization Fund.

Under the new notice, at least 50 percent of the fund’s cash balance must be used to make loans to market intermediaries for refinancing as margin lending, while up to 40 percent of the fund’s cash balance may be used for direct purchases and sales of listed securities. .

The maximum 10 percent of the fund’s cash balance may be used for investments in other securities, including fixed deposits, government securities, fixed-income securities and mutual funds, it said.

According to the data from the Dhaka and Chittagong stock exchanges, 335 listed companies have unclaimed dividends worth Tk 956 crore and unclaimed or unsettled stock dividends worth Tk 19,986 crore, BSEC officials said.

The fund must be managed by maintaining a bank account with a scheduled bank in the name of the Capital Market Stabilization Fund and a consolidated brokerage account or beneficial owner’s account (BO) in the name of the Capital Market Stabilization Fund, they said. they.

The BSEC officials said the regulator would monitor capital market volatility and liquidity through the fund.

The fund may generate income from the purchase and sale of securities and from all investments, from the lending and lending of securities and other credit facilities, from interest income on bank deposits and fees and penalties received.

If a shareholder or participant claims his/her dividends or shares, the issuer must recommend detailed information to the head of the fund paying such dividend out of the fund within 15 days of receipt of such claim, and the CB must submit the claims within 15 days of receipt of such claim. days after such recommendation.