7:10 PM
Amid the sluggish trend in the share market, Bangladesh Bank has redefined banks' investment in the capital market.
As per a circular, issued by the central bank's offsite supervision department, the capital provided by banks to their subsidiary companies will not come into calculation of their (banks) total capital market investment.
The new definition of the central bank will be applicable only for solo basis calculation of the banks' capital market investment.
The latest policy directive will come into effect from January 2016, said the circular adding that the monthly statement tabulation for capital market statement has been changed in light of the new directives.
Many believe that the new policy directive of the central bank will play a supportive role to revive the ailing capital market.
They said the central bank's move came against the backdrop of the prevailing sluggish trend in the share market, as the Dhaka Stock Exchange's (DSE) index came down to nearly 4500 point.
Bangladesh Bank officials said new policy support will encourage most of the banks to invest more in the capital market.
Currently, there are 33 capital market subsidiary companies of the banks. A total of 48 banks, out of 56, have investment in the capital market. Of them, 26 banks' capital market investment is below 25 percent as on 30 November.
The central bank earlier asked the banks to bring down their overall capital market investment within 25 percent of their respective total capital by 21 July 2016 in line with the Banking Companies (Amended) Act 2013.
Prothom Alo
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