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The Securities and Exchange Commission (SEC) made Saturday a few changes in the operation of the bourses.
The capital market watchdog decided to allow repurchase of 'A' category shares against their sale, increase the limit of brokers' credit margin with clearing houses of the bourses and reduce the settlement period for 'A' category share. The SEC through these changes has only revived some of the old practices.
All the decisions taken at a meeting chaired by the SEC chairman Mirza Azizul Islam will come into effect from today (Sunday).
Market stakeholders were found to be optimistic about the positive impact on the overall situation of the market. They said the latest SEC steps would encourage the investors to come in a big way. It would also enhance the liquidity position of the country's securities markets, they added.
According to the new decision regarding the repurchase of shares against sale orders, a seller would be allowed to buy back the same number of 'A' category shares on the same day without waiting for the actual settlement and vice versa.
This would help boost transactions in the stock markets and reduce the risk of investors' funds being stuck up with the stockbrokers, market sources said.
Stockbrokers said the provision for buying back shares of 'A' category was in operation several months back.
At the Saturday's meeting, the commission also extended the free credit limit of the stockbrokers with the clearing houses of the bourses from Tk 5.0 million to 10 million. This system was also in operation a couple of months back.
Apart from banks and insurance companies, non-banking financial institutions (NBFIs) would be able to act as guarantors for the stock members against their credit margin, the meeting decided.
The SEC, a couple of months back, slashed down the credit margin from Tk 10 million to Tk 5.0 million.
Besides, from now on the settlement period for 'A' category shares would be T+3, in place of T+4.
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