‘Lack of updated information hurts stock investors’

The BSEC was also considering redefining the definition of Price Sensitive Information (PSI) to ensure its due objective

The demise of 62 directors from 32 listed companies were not updated in their respective websites, which prevented investors from getting updated information, said Commissioner of the Bangladesh Securities and Exchange Commission (BSEC), Prof Shaikh Shamsuddin Ahmed, on Saturday.

He also said that about 15% of listed companies’ websites were non-functional, despite it being mandatory by law to keep their information updated at all times. Additionally, 7% of the listed companies did not have any annual report on their websites.

The BSEC commissioner made the remarks at a webinar titled “Technology to Protect and Assist Investors in the Capital Market”, organized on World Investors Week 2020, by Bangladesh Merchant Bankers Association (BMBA) on the day.

He also informed that BSEC was set to allow stockbrokers to open trading booths across the country to make capital markets more accessible for the people.

Shamsuddin said investors would be able to trade from any part of the country if the booths were launched.

The stock market regulator was also working to ensure easy participation of foreign investors in the country’s capital markets, he added.

He laid importance on technology adoption and integration, adding that transparency and mass participation could not be ensured without technology.

The BSEC was also considering redefining the definition of Price Sensitive Information (PSI) to ensure its due objective.

“Our observation is that many PSIs do not reflect the sensitivity that really matters. That is why PSI should be redefined,” said the BSEC commissioner.

He also laid importance on transparency of mutual funds.

“Fund managers often speak for investments in non-listed companies to enhance returns. But we must know about the non-listed securities where they want to invest,” he emphasized.

Md. Jasim Uddin Akond, president of Institute of Cost and Management Accountants of Bangladesh (ICMAB), said cost auditing should be compulsory for listed companies to reduce their losses.

“Investors’ interests can be secure on a large scale if cost auditing is made mandatory for listed companies,” he said.

BMBA member Mir Mahfuz Ur Rahman was the keynote speaker in the webinar. 

In his speech, Mahfuz highlighted the importance of adopting technology-based market operations.

Referring to the example of Hong Kong, he said foreign investors could be allowed to conduct mobile app-based trading to expand the capital market.

BMBA president Md. Sayadur Rahman said many companies witnessed unsustainable price hikes on debut trading as investors could not judge the companies’ fundamentals.

“Initially, those companies influence the index to go up but eventually they lose their price, leaving a negative impact on the index,” he said.

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