STAR BUSINESS REPORT

Bangladesh Securities and Exchange Commission (BSEC) Chairman Masud Khan said the regulator would take an aggressive approach to attract quality companies to the stock market, arguing that such a move is necessary to build a more stable and mature capital market.

Speaking at the 10th anniversary event of CFA Society Bangladesh at Sheraton Dhaka on Saturday, Khan said the market currently suffers from a shortage of quality stocks, while a significant share of trading remains concentrated in weak and speculative shares.

“We have to bring very good scripts into the market, very quickly,” he said, stressing that investors need access to more fundamentally sound companies.

The BSEC is exploring various incentives to encourage strong companies to go public. While tax incentives remain an option that would require discussions with the National Board of Revenue (NBR), he suggested several administrative measures that could make listing more attractive.

Among the proposals, Khan floated the idea of creating a separate tax administration framework for listed companies, arguing that compliant listed firms should face fewer regulatory burdens than unlisted entities.

Khan also highlighted the long-term benefits of listing, saying publicly traded companies tend to become stronger institutions through improved governance, professional management and succession planning.

He further revealed plans to promote direct listings, particularly for multinational corporations, well-governed banks, state-owned enterprises and reputable local companies.

According to him, direct listings could quickly increase the supply of quality shares in the market without requiring companies to raise fresh capital.

Noting that Bangladesh remains heavily reliant on retail investors, Khan emphasised the need to strengthen institutional participation in the stock market. He said deeper involvement by pension, provident and gratuity funds would help the market progress from frontier-market status towards emerging-market standards.

The chairman argued that stronger institutional investment, alongside the listing of quality companies, is essential for creating a more stable and mature capital market.

He also called for major regulatory simplification and digitisation, saying the existing regulations governing IPOs, margin loans and mutual funds have become unnecessarily complex. Applications for IPOs and rights issues should be fully automated, he said, adding that regulators should “regulate where necessary and simplify where possible.”

Asif Khan, president of the society, and M Masrur Reaz, chairman and chief executive officer of Policy Exchange Bangladesh, also spoke at the event.