Commercial banks yesterday vowed not to embark on aggressive sell-offs, cited as one of the major reasons behind the market crash of last year.

“We have urged the banks not to adopt such tactics when the market is on the up, and they have assured us they will not,” Rakibur Rahman, president of Dhaka Stock Exchange, said after a meeting with the Association of Bankers, Bangladesh (ABB).

“Of course, the banks will make profits, but the share sale should not be in a disruptive manner,” he added.

Aggressive sell-offs, essentially, is the sale of a bulk amount of securities to book large amount of profits, a tactic which banks and other institutional investors adopted between 2009 and 2010, when the market was experiencing a bull run.

Rahman said the market is slowly inching towards stability, and the institutions' active participation at this moment could not be more important.

“But any aggressive sell-offs [by the institutions] may destabilise the market again,” he said.

Nurul Amin, president of the ABB, a platform of chief executives of Commercial banks, said they sat with the premier bourse to find out ways to make the secondary market more stable.

“We are not traders. We are long-term investors and we are maintaining our investment in the secondary market in line with the regulatory limit,” said Amin, also the managing director of NCC Bank.

The ABB chief also suggested the Dhaka Stock Exchange (DSE) take steps to activate the bond market.

The DSE president urged the retail investors to take investment decision wisely, instead of emotionally.

“Only those who have knowledge and ability should come to the market,” he said.

News: The Daily Star/Bangladesh/29-Sep-12