The Asian Development Bank (ADB) will put forward a set of recommendations on the demutualisation of the stock exchanges to the government by next month to help the government and the bourses take decision on the demutua-lisation process.

“We are looking at the demutua-lisation of the Dhaka Stock Exchange and studying the situation. We will be making our recommendations to the government by February this year,” ADB Country Director Thevakumar Kandiah told journalists after a meeting with the premier bourse officials at the DSE building yesterday.

It will be up to the government and the DSE to decide on how they will take the recommendations, the ADB country director said.

The ADB is offering technical assistance to help implement the demutualisation.

Kandiah also said the ADB is preparing to release this year a second financial assistance package -- capital market loan programme -- for the development of the stockmarket in Bangladesh.

“We have a team that is preparing the policy actions of the loan progra-mme,” he added.

DSE President Md Shakil Rizvi said the bourse is working with many international agencies including the ADB in making the stock exchange an international standard resourceful entity.

“This is not the first time that the ADB is working with the stock exchanges; it also got involved in the automation process of the premier bourse and the establishment of the Central Depository of Bangladesh Ltd,” he said.

The meeting also discussed the technical and other assistances the Dhaka bourse will get from the donor agency, Rizvi added.

Recently, following a regulatory instruction, the DSE submitted a concept paper on its demutualisation process to the finance ministry and the Securities and Exchange Commission.

Demutualisation will transform the bourse from an entity owned by mostly brokerage members into a for-profit company of the shareholders.

The process is expected to ensure sound corporate governance, alternative business models and operational efficiency. A demutualised exchange can freely trade on the market like a public company.

The Daily Star/Bangladesh/ 9th Jan 2012