BSEC clarifies Chairman’s remarks, denies delisting decision on closed companies

The Bangladesh Securities and Exchange Commission (BSEC) on Sunday clarified that it has not taken any decision to delist closed companies from the stock market, terming recent media reports on the matter “misleading” and “baseless.”

In a press release, the securities regulator said the confusion stemmed from remarks made by BSEC Chairman Masud Khan during an exchange of views meeting with journalists at the Capital Market Journalists' Forum (CMJF) office on July 9.

The commission said one of the Chairman's statements was presented out of context and misrepresented, following which several newspapers, online portals and electronic media outlets reported that BSEC had decided to delist closed companies.

The BSEC said such reports do not correctly reflect what the Chairman actually said.

According to the press release, the Chairman told journalists that in most capital markets around the world, companies that remain inactive or closed for a long time are not kept indefinitely on the listed status.

He noted that Bangladesh is an exception in this regard, where some companies continue to remain listed despite being closed for extended periods, putting general and small investors at particular risk.

The Chairman further said that as the frontline regulator, the concerned stock exchange bears the primary responsibility for such companies.

He noted that the Dhaka Stock Exchange (DSE) has been reviewing the issue and has taken the initiative to formulate a rational and sound process in this regard.

As part of the discussions, inactive companies may be given a specific timeframe, such as one year to resume operations, failing which further action could be considered in line with existing laws, rules, listing regulations and prescribed procedures, the BSEC said.

However, keeping investors' interests and welfare in mind, the commission said investors should exercise greater caution before investing in shares of companies that have remained closed or inactive for a long time, are going concerns, do not hold regular annual general meetings (AGMs), or do not pay dividends.