Photo: Collected
The stock market has experienced a major crash cantered around the resignation of Professor Shibli Rubayat-Ul Islam from the post of Chairman of the Bangladesh Securities and Exchange Commission (BSEC) and the appointment of a new chairman. In just one day of this crash, investors' capital decreased by nearly Tk 8,000 crore.
Various rumours have spread regarding who would be the new chairman. These rumours have created fear and panic among investors, leading everyone to sell their shares. Those involved in the stock market believe this has resulted in a significant price drop.
Insiders say that since August 5, after Sheikh Hasina's government resigned following the student quota reform movement, positive trading had continued in the stock market. However, since August 10, when BSEC Chairman Shibli Rubayat-Ul-Islam resigned, extreme instability has prevailed in the market cantered around the appointment of a new chairman. A crisis of confidence has emerged among investors, who are selling shares and withdrawing money, resulting in an ongoing price decline.
When asked about this, Mohammad Rezaul Karim, executive director and spokesperson of the BSEC, told The Daily Messenger, “The stock market had been on an upward trend for quite some time. Then there was a price correction, but now various rumours have arisen in the market regarding the appointment of a new chairman. We hope that with the new chairman taking charge, the market will turn around.”
According to Dhaka Stock Exchange (DSE) data, there have been a total of six trading days from August 11 to August 18 in the country's stock market. Among these, the stock market experienced a price drop on four trading days. However, on Sunday, the first trading day of the week, the stock market saw a major crash.
On this day, while the share prices of 18 companies increased, the share prices of 366 companies decreased. As a result, DSE's main index, DSEX, fell by 125 points. Due to the index drop, investors' capital, i.e., market capitalisation, decreased by Tk 7,886 crore. Despite thousands of sellers in the market, there weren't as many buyers.
Not just on Sunday, August 18, but since the resignation of former BSEC Chairman Professor Shibli Rubayat-Ul-Islam, this price decline has continued in the market. As a result, in the last six days, DSE investors' capital has decreased by Tk 12,274 crore 46 lakh 86 thousand.
Meanwhile, to recover from this situation in the market, the Financial Institutions Division of the Ministry of Finance has appointed Khondoker Rashed Maqsood as the BSEC chairman. He will serve as BSEC chairman for the next four years.
Regarding this, Al-Amin, Associate Professor at Dhaka University, told The Daily Messenger, “Due to various controversies surrounding Masrur Riaz's appointment, the stock market has seen a price decline for several days. Now, a banker from outside has been appointed as BSEC Chairman instead of an academic. How investors will view this matter will be seen from tomorrow (today).”
Notably, after the fall of the Hasina government on August 5 in the face of student and public movements, Professor Shibli Rubayat-Ul-Islam resigned from the post of Chairman of the Bangladesh Securities and Exchange Commission (BSEC), the regulatory body of the stock market, on August 10.
Then, on August 13, to comply with the provisions of Sections 5 and 6 of the Bangladesh Securities and Exchange Commission Act 1993, the interim government appointed Dr. M Masrur Riaz as BSEC Chairman according to Section 5(2) of this Act. However, on August 17, Dr. Masrur Riaz expressed his inability to take charge as BSEC Chairman. Exactly one day later, on August 18, the Financial Institutions Division of the Ministry of Finance issued a notification appointing Khondoker Rashed Maqsood as BSEC Chairman.
Investors and those involved in the stock market hope that the market will improve and expect to recover their lost capital.
Messenger/Disha
