To maintain a stock fund
FROM PAGE B1
In the preceding year, meaning fiscal year 2021-22, the total operating cost of the fund stood at Tk 2.40 crore, of which Tk 1.19 crore was in the form of honorariums and event expenses.
This newspaper is yet to secure minutes of the meetings to know exactly what they were about.
However, according to the financial report, there was roughly Tk 1,545 crore in the fund as of last June.
Since the fund’s inception, Tk 265 crore has been returned to over 2,700 investors.
‘A QUESTION OF ETHICS AND LOGIC’
From the fund, ICB AMCL CMSF Golden Jubilee Mutual Fund was launched with Tk 50 crore in sponsorship.
Another Tk 225 crore from the fund was kept as fixed deposits with the Investment Corporation of Bangladesh (ICB).
Also, loans of Tk 5 crore were provided to some market intermediaries from the fund.
Another Tk 348 crore has been kept with a bank and the rest remains in the fund’s BO account as stock dividends.
“A major portion of the fund has been kept with other entities that are taking all the investment decisions,” said Md Moniruzzaman, managing director and CEO of Prime Bank Securities.
“So, the CMSF custodian has very little to do, let alone hold so many meetings,” he added.
Moniruzzaman recently told this newspaper that all expenses should have proper justification as it is a question of ethics and logic.
Usually, research and staff salaries account for the lion’s share of the operating cost of any fund, according to Shahidul Islam, CEO of VIPB Asset Management Company.
“As a major portion of the CMSF rests with other entities, its board does not have to conduct any research to decide on investment options. Its operating costs should be very low,” he said.
“In our company, we held four meetings last year and the honorarium for directors was around Tk 2 lakh, which is 1 percent of the total operating costs,” Islam said. “I don’t see any logic to spend such a high amount of money behind honorariums.”
WASTAGE OF MONEY?
The Daily Star could not reach Md Nojibur Rahman for comment despite repeated phone calls and a text message recently.
However, this newspaper was able to reach the CMSF’s Chief of Operation Md Monowar Hossain.
He said the custodian had to hold many meetings as the fund was at a primary stage and now it has attained a strong position.
“The CMSF has provided a huge number of undistributed dividends to the right investors,” he said. “We are very much cautious so that the investors’ fund does not face any erosion.”
Of the expenses, none was met from the principal amount. All the costs were borne from the interest income of the fund, he added.
The Daily Star also spoke with two members of the CMSF board.
They, on condition of anonymity, said almost all relevant decisions were taken by the CMSF chairman in consultation with the BSEC’s top officials.
They believe that these types of meeting expenses and honorariums were a wastage of funds and they had advised to reduce the number of committees and meetings.
BSEC Spokesperson Farhana Faruqui said the stock market regulator noticed the issue a couple of times and launched an inquiry.
Based on the findings of the inquiry, the BSEC is going to take steps soon and the matter is currently being overseen by the enforcement department, she added.