A joint taskforce is being formed to introduce legal changes that would make it mandatory for large companies to go public if their loans or turnover exceed certain thresholds. The committee will comprise representatives from Bangladesh Bank, the Bangladesh Securities and Exchange Commission (BSEC), and the Financial Institutions Division (FID). The taskforce aims to develop a vibrant bond market and has already initiated discussions with several large local companies and multinational corporations (MNCs) regarding potential stock market listings. BSEC Chairman Khondoker Rashed Maqsood emphasized the importance of these efforts in enhancing market depth and transparency. In a related development, the BSEC has sought public opinions on proposed amendments to IPO (Initial Public Offering) rules. The taskforce submitted a set of recommendations to the securities regulator, aiming to modernize regulatory frameworks, enhance market efficiency, and ensure transparency to attract reputable companies to the equity market. The taskforce’s recommendations include allowing direct listings for multinational firms and large companies with annual turnovers exceeding Tk 10 billion. Currently, only state-owned enterprises are permitted to list on the stock exchanges through direct listing. Additionally, the taskforce has proposed slashing the minimum offload requirement to 10% from the existing 25% for direct listings, aiming to facilitate the entry of well-performing companies into the market. Mandatory listing has been proposed for large corporations with outstanding bank loans exceeding Tk 10 billion. To promote equitable IPO pricing, the task force has proposed bringing back the Dutch Auction method. This approach involves the auctioneer beginning with the highest price, then gradually lowering it until an ideal price is found. Additionally, the panel suggests enforcing a three-month lock-in period for 50% of the shares owned by institutional investors, encouraging careful decision-making during the bidding phase. The task force also seeks to speed up the IPO timeline by recommending a maximum period of six months from the time a proposal is submitted until trading starts, which matches the regional standards of three to six months. These initiatives reflect a concerted effort to strengthen Bangladesh’s capital market by encouraging the listing of large, reputable companies and enhancing the overall market infrastructure.
