BB asks merchant banks, brokers to follow SEC order
The Bangladesh Bank Wednesday issued a circular asking merchant banks and brokers to comply with margin-loan directives of the Securities and Exchange Commission in providing credit facilities to share investors.
The circular said all financial institutions and its subsidiary companies are directed to follow the SEC directives on margin loans issued on September 30, 2012.
The market regulator in the issued directives set the highest margin loan ratio for stock exchange members and merchant bankers.
According to the new margin loans ratio, the merchant bankers and the stock broker will be allowed to provide loans at 1:2 ratios till June 30, 2013. It means an investor will get loan of Tk 200 against his or her holding of securities worth Tk 100.
From July 1 to December 31, 2013, the margin loan ratio would be 1:1.5 and from January 1 to June 30 2014 it would be 1:1. The last limit that would start from July 1, 2014 would continue until further notice is 1:0.5.
News: The Daily Sun/Bangladesh/22-Nov-12
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