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24-May-2015
IPO Application Form (A4)

20-Feb-2014
Notice for change Margin Loan Ratio

28-Nov-2013
Notice for Fund Withdrawal in Margin Account

03-Nov-2013
Notice for Affected Investors

19-Jun-2013
Notice for maintaining minimum purchase power in Margin Account

Daily Business News All Daily Business News
15 Jul 2013
JS amends bank company act

Parliament on Sunday passed the Bank Company (Amendment) Bill - 2013 aimed at ‘streamlining’ appointment of directors in banks and reducing their exposure in the capital market. The bill obligates the owners of bank companies to appoint three independent directors in the bank management boards to ensure transparency. The bill will also bar directors of banks or bank companies from simultaneously holding similar posts in multiple financial institutions.

The state minister for law, Quamrul Islam, tabled the bill bringing amendments to the Bank Company Act - 2013 in parliament on April 22. It was then sent for scrutiny to the parliamentary standing committee on the finance ministry, which recommended the bill’s enactment. The opposition members opposed the bill at the fag end of the government’s tenure and most of them found the bill aimed at making further scope for plundering of wealth. The minister for finance, AMA Muhith, trashed the accusations of the opposition bench and branded the allegations of looting a mere propaganda.

Banks and bank companies will have to appoint independent directors within three years of the law’s passage. The 1991 banking act had a provision for optional appointment of independent directors. The country’s development partners, including the International Monetary Fund, have been pressing the government to make the appointment of independent directors mandatory. The bill proposed amendment to Section 15 of the 1991 law, provision for each bank to have a maximum of 20 directors including three independent ones, who would be appointed by the board with the approval of the Securities and Exchange Commission. The independent directors would in no way have any involvement or interest with the owners of the banks or bank companies and they would merely give their opinions in the interests of the financial institutions, the bill proposed.

The bill further proposes that only two family members, including spouses, parents, children or siblings, will be eligible to hold directorial posts in a bank at the same time. As per the changes, anyone can stay in the board for two successive terms, but there has to be a break for the third term. It also bars multiple members from a single family to be directors of any bank at the same time. The bill said no bank would be able to buy shares of a company amounting to more than 10 per cent of the company’s paid-up capital and more than five per cent of the company’s total market borrowings.

It stipulated that a bank can invest up to 25 per cent of the total of four components of core capital in the capital market — shares, corporate bond, debenture, mutual fund or any other stock market instrument or funds. The core capital includes paid-up capital, share premium, statutory reserve and retained earnings. It said that within three years of enactment of the law the banks have to lower their investment to the new limit.

At present banks can invest up to 10 per cent of their total liabilities in the capital market. The new limit means that the exposure limit for banks in the capital market would be lower when the bill turns into act after the president endorses it. Capital market stakeholders said that the banks currently have around 2-3 per cent of their liabilities in stock market investment. The bill also keeps a provision of maximum Tk 20 lakh as fine for investing more than the new limit in the share market by the bank companies.

In case of continued violation of this provision, another Tk 50,000 will be fined per day from the second day of breaching the law. The bill proposes preventing illegal banking in the name of cooperative societies. Besides, under the law, definition and scope of loan defaulters have been simplified and widened.

Source :: New Age