...An Analysis On The Role of Bangladesh Securities and Exchange Commission Course Name : Financial Institution and Market Course Code: Fin-335 , Sec: 1 Prepared for Prof. Tanvir Ahmed Chowdhury Chairman, Department of Business Administration East West University Prepared by Holistic Heroes Submission Date: 25th March, 2014 Group Profile Department Of Business Administration Letter of Transmittal 25th March 2014 Prof. Tanvir Ahmed Chowdhury Chairman Department of Business Administration East West University Dear Sir, It gives us immense pleasure to present our term paper on the topic “ An Analysis on Bangladesh Securities and Exchange Commission, for the course Financial Institution and Market (FIN_335). By doing this paper we have learned a lot practical issues regarding BSEC , Capital Market, Stock Market, Bond Market etc and we think that will help us in our near future. We would like to thank you for your valuable guidance in every problem we had the precious time that you give us. We will be available for any further clarification required and requesting to accept our term paper. Thank you Sincerely All the Members of Holistic Heroes Syed Md. Fakruuddin Nahid Hasan Sayma Sultana Al Mumtahina Shuovy Asma Sultana Nusrat Sharmin Eva Table of content | Page no | Introduction | 6 | 1.0.0 Bangladesh Securities and Exchanges Commission | 7 | 1.2.0 Function of BSEC | 9 | 2.0.0 Capital...
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...STOCK MARKET CRASH OF BANGLADESH IN 2010-11 History of the stock market crashes show that ‘Bull Run’ before a stock market crash is kind of normal phenomenon. There was no exception for the stock market crash of Bangladesh in 2010-11. Most important factors that guided to the Bull Run are described here. Root of bubble Due to political conflict of Bangladesh state of emergency was declared and military took power of the country in 2007. Moreover, during military-backed regime investment in real sectors as well as FDI decreased but the inflow of foreign remittance increased. At that time, investors were looking for alternative investment sector to invest their savings and found stock market as an attractive alternative. According to Centre for Policy Dialogue (CPD) 2011, the total number of BO Account holders on 20th December, 2010 reached to 3.21 million though the number was 1.25 million in December 2009. Most of these new investors don’t have enough knowledge about the stock market but invest their most or all savings in the market. However, 238 brokerage houses opened 590 branches at 32 districts. As CPD (2011) found, there are some factors which attracts investors such as internet-based trading operation, opening branches of brokerage houses across the country, easy access to the market information, arranging a countrywide 'share mela (fair)'. Unfortunately, to chase huge capital of too many investors, there were not enough supplies of new securities through IPOs in the market...
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...CHITTAGONG STOCK EXCHANGE: BACKGROUND : “Founder members of the proposed Chittagong Stock Exchange approached the Bangladesh Government in January 1995 and obtained the permission of the Securities and Exchange Commission on February 12, 1995 for establishing the country's second stock exchange. The Exchange comprised of twelve Board members, presided by Mr. Amir Khosru Mahmud Chowdhury (MP) and run by an independent secretariat from the very first day of its inception. CSE was formally opened by then Hon'ble Prime Minister of Bangladesh on November 4, 1995.” MISSION: The mission of the CSE is “to create on effective, efficient and transparent market of international standard to save and invest in Bangladesh in order to facilitate the competent entrepreneur to raise capital and accelerate industrial growth for overall benefit of the economy.” The Chittagong Stock Exchange believes that a dynamic, automated, transparent stock exchange is needed in Bangladesh. It works towards an effective, efficient and transparent market of international standard to serve and invest in Bangladesh in order to facilitate the competent entrepreneurs to raise capital and accelerate industrial growth for overall benefit of the economy and keep pace with the global advancements. VISION: The visions of CSE are as follows: a) To develop a strong platform for raising capital b) To provide an investment opportunities for the investor c) To develop a corporate culture through...
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...BANGLADESH STOCK MARKET GROWING? KEY INDICATORS BASED ASSESSMENT Abstract This paper focuses on the growth of Bangladesh stock market over time. The market trends in terms of market capitalization, market liquidity, market concentration, number of listings, volatility in the market index and foreign portfolio investment were considered. The study finds that key indicators are significantly correlated. Stock market growth index is constructed considering market capitalization ratio; turn over ratio, value traded to GDP ratio and volatility in market index. The findings of the study suggest that although Bangladesh stock market is growing over time, the growth has not yet assumed any stable and obvious trend. We conclude that Bangladesh stock market is still at an early stage of its growth path with a small market size relative to GDP and is characterized by poor liquidity and high market concentration. Introduction Demirguc-Kunt and Levine (1996), Singh (1997) and Levine and Zervos (1998) find that stock market growth plays an important role in predicating future economic growth in situations where the stock markets are active. The arguments of Demirguc-Kunt et al. (1996) indicate that economies without well-functioning stock markets may suffer from three types of imperfections: first, opportunities for risk diversification are limited for investors and entrepreneurs, second, firms are unable to optimally structure their financing packages and third, countries...
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...Introduction: The stock market of Bangladesh is considered to be one of the emerging markets in the context of the global financial system. The market has immense potentials for country’s industrialization, development of infrastructure in particular and economic growth in general. The government and the Securities and Exchange Commission (SEC) have undertaken a good number of initiatives to meet Bangladesh's development financing requirements with a particular focus on developing long term infrastructure financing and strengthening financial stability through promotion of capital market. In this regard formulation of a Master Plan is of crucial importance. Stock markets or Stock exchanges play an important role in the modern capitalized economy by providing the strength to nation's economic infrastructure. Now the stock market is one of the most important sources for companies to raise capital. Stock market allows businesses to raise additional capital for expansion by transferring the ownership of the company. It provides individuals the opportunity to invest in corporations. The size of the world stock market was estimated at about $36.6 trillion at the beginning of October 2008. In Bangladesh, there are two stock exchanges, the Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE), DSE was setup on April 28, 1954 that started formal trading in 1956. In 1995, CSE was setup. However, in its fifty-eight year’s history the stock market of Bangladesh crashed two times...
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...Literature Review on Bangladesh Stock Market Literature Review: 1 Before the decade of eighty much of the stock market literature viewed the present value of dividends to be the principal determinant of market return of stocks. LeRoy and Porter (1981) and Shiller (1981) found that under the assumption of constant discount factor stock prices were too volatile to be consistent with movement in future dividends. The decomposition of stock price movements is very sensitive to what assumption is made about the presence of permanent changes in either real dividend growth or excess stock return (Wohar & Mark, 2006). Cochrane (1992) Timmerman (1995) have argued that fluctuation in stock prices can be explained by time-varying discount rates and future excess returns. Cochrane (1992) by using an alternative methodology to decompose the variability of stock prices also found the variability of excess return to be more important than the variability of dividend growth. A lower degree of efficiency in less developed countries market might be caused by common characteristics of loose disclosure requirements as well as thinness and discontinuity of trading. It is generally assumed that the emerging markets are less efficient than the developed markets. Raihan, et al (2007) found that in Chittagong Stock Exchange (CSE) in Bangladesh, stock return series do not follow random walk model and the significant autocorrelation co-efficient at different lags do not accept the hypothesis...
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...[pic] PREMIER UNIVERSITY CHITTAGONG TOPIC: STOCK MARKET SITUATION AND MARKET CRASH OF BANGLADESH STOCK MARKET, 2011 PREPARED TO: TANBINA TABASSUM LECTURER, FACULTY OF BUSINESS STUDIES, PREMIER UNIVERSITY CHITTAGONG. PREPARED BY: THE DOERS SEM: 8TH, SEC: A, DEPT.: FINANCE PROGRAM: BBA, SESSION: JULY ’11 DATE OF SUBMISSION: 19 DECEMBER, 2011 GROUP NAME: THE DOERS |SL. |STUDENT NAME |ID | |1 |TRISHAN CHOWDHURY |0714111851 | |2 |NISHAT FATEMA KHANAM |0714111864 | |3 |UMME KULSUM |0714111866 | |4 |ANUPAM GUPTA |0714111848 | |5 |PARTHA SARATHI ROY CHOWDHURY |0714111859 | |6...
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...This paper examines the state of relationship between the stock market development & economic growth in Bangladesh. As a third world country, the economic development of Bangladesh is still dependent on the ups & downs of some macroeconomic as well as capital market factors , like, GDP, real GDP, GDP growth, market capitalization, volatility of stocks, Financial Statement information and other financial factors. This paper has been prepared & presented to have a clear view about contribution of capital market to the economic growth of Bangladesh. So far I know, no analytical study regarding this issue still has not been conducted in Bangladesh. So that I’ve desired to study on this topic in a deeper detail to focus on the relationship of capital market & economic growth from both economic & accounting point of view. I also have focused on how the reporting of the Financial Statements of different institutions according to various local & international standards can have an impact in accelerating the economic advancement in Bangladesh. In assessing the impact of stock market on our country’s economy, I have used some statistical techniques & finance issues as correlation & regression analysis, measurement of cost of capital, index method etc based on the data obtained from the main stock exchange of the country DSE. The study reveals that there is a very close & positive relationship of stock market development of Bangladesh with this country’s economic growth. And also another result...
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...Department of Finance and Banking Jahangirnagar University Savar, Dhaka FNB209: Financial Institutions and Markets | Executive Summary Submission of the Report on : Efficiency Analysis and Volatility Effect of Bangladesh Stock Market Submitted by:Sariful Islam(Student ID: 610)Ashfaq-ul- haq oni(Student ID: 621)Jafrin Siddique (Student ID: 1922)Zunaid Hossain (Student ID: 1928)K. M. Zeman Adnan (Student ID: 2128)William Masterson Shah (Student ID: 2129) | Submitted to:Dr. Sheikh Abu TaherLecturer,Department of Finance & BankingJahangirnagar University | August 2, 2012 Term Paper Topic: Efficiency Analysis and Volatility Effect of Bangladesh Stock Market Executive Summary: This paper empirically examines the behavior of stock returns in the Bangladesh stock market namely Dhaka Stock Exchange (DSE), the efficiency of the market in pricing securities and the relationship between stock returns and conditional volatility and the impact of some institution factors such as lock-in, circuit breaker, and caretaker government on volatility, using best known three different daily price indices DSEG, DSI and DS20. The results of autocorrelation function, results of ADF and PP tests and also the results of ARIMA models do not support the hypothesis of weak-form of market efficient of DSE. The results of GARCH (p, q)-M models indicate significant departure from the hypothesis of weak form efficiency; the tendency for returns to exhibit volatility clustering;...
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...merchant banker arrive at the final issue price, according to the demand and supply for instrument, at different price points. The relatively mature capital markets across the globe have established this as a simple and more acceptable and popular method for floating of new issues, rather than arbitrarily determine the issue price at a price point, in advance to the IPO, by way of expected demand for the issue, and the premium it may be able to command. However, in some of the emerging markets where capital markets have not yet become mature enough, book building method for IPO’s is still at a nascent stage. Book building method is a relatively new phenomenon of modern pricing mechanism for IPOs, which encourages companies to enlist with stock exchanges as it ensures fair pricing of initial public offerings (IPO). While in some of the developed...
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...BANGLADESH STOCK MARKET GROWING? KEY INDICATORS BASED ASSESSMENT M Khokan Bepari Assistant Professor Department of Cooperation and Marketing Faculty of Agricultural Economics & Rural Sociology Bangladesh Agricultural University, Mymensingh-2202, Bangladesh Phone: +88 01716601759 khokan552@yahoo.com Dr. Abu Mollik Senior Lecturer and Finance Discipline Leader School of Commerce and Marketing Division of Business and Informatics Central Queensland University abumollik@yahoo.com.au Abstract This paper focuses on the growth of Bangladesh stock market over time. The market trends in terms of market capitalization, market liquidity, market concentration, number of listings, volatility in the market index and foreign portfolio investment were considered. The study finds that key indicators are significantly correlated. Stock market growth index is constructed considering market capitalization ratio; turn over ratio, value traded to GDP ratio and volatility in market index. The findings of the study suggest that although Bangladesh stock market is growing over time, the growth has not yet assumed any stable and obvious trend. We conclude that Bangladesh stock market is still at an early stage of its growth path with a small market size relative to GDP and is characterized by poor liquidity and high market concentration. Introduction Demirguc-Kunt and Levine (1996), Singh (1997) and Levine and Zervos (1998) find that stock market growth plays an...
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...Mercantile Bank Limited THURSDAY, AUGUST 11, 2011 I.1 Mercantile Bank Ltd at a glance Mercantile Bank Limited is one of the famous & oldest private banks in Bangladesh. It is a scheduled private commercial Bank established on May 20, 1999 under the Bank Company Act 1991 by Mr. Abdul Jalil (MP), & registered as a Public Limited Company under Companies Act, 1994. The Bank started commercial Banking operations for both organizations & individuals from June 02, 1999. From then within a short time MBL established itself in a strong position in the economy of the country having 35 branches all over the country. It has earned significant reputation in the country’s Banking sector as a Bank & created a wide image in the eye of the people by helping people in investing their money earn profits & serving different organizations to save their money is secured place along with investing in different other businesses for profit, organizational development, country’s economic growth & exchanging money & dealing international business in foreign currency. The dream of creating MBL, which is ‘A Bank of 21st Century’, & fulfilling its will to become “Banglar Bank” as its title says has become successful because of the initiative of some persons who are the sponsors of MBL. There are 30 sponsors in Mercantile Bank Limited and all of them are highly regarded for their entrepreneurial competence. Mercantile Bank Ltd. has consistently turned over good returns on Assets and Capital. Until...
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...The samples of the study consist of 100 respondents of different categories namely, brokers, clients, and e-service providers. The survey was conducted based on structured questionnaire. Non-probability respondents have been studied by selecting persons who do the stock trading. People, who are not involved in the trading, were not interviewed. Under the constraints of time and money samples were selected for Dhaka city only. 4.2 Data collection and procedure The data were collected from two sources: (a) Primary sources – it includes well-structured questionnaire, personal interview and observation, and (b) Secondary sources – it includes annual reports, published and unpublished articles, books, websites, newspaper etc. 4.3 Data analysis and presentation After collection of data from the different areas, those were summarized and presented in a tabular form to make the study more analytical, informative and representative to the reader using SPSS. In this study both parametric and non-parametric statistical tools were used to interpret and present data. 5. Discussion 5.1 Electronic broking Electronic broking is actually a prerequisite for complete implementation of e-Trading. An electronic market is an attempt to use information and communication technologies to provide geographically dispersed traders with the information necessary for the fair operation of the market (Whitely, 2000). The electronic market (or simply, e-market) is, in effect, a brokering ...
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...Overview of Financial system of Bangladesh The financial system of Bangladesh is comprised of three broad fragmented sectors: 1. Formal Sector, 2. Semi-Formal Sector, 3. Informal Sector.The sectors have been categorized in accordance with their degree of regulation. The formal sector includes all regulated institutions like Banks, Non-Bank Financial Institutions (FIs), Insurance Companies, Capital Market Intermediaries like Brokerage Houses, Merchant Banks etc.; Micro Finance Institutions (MFIs). The semi formal sector includes those institutions which are regulated otherwise but do not fall under the jurisdiction of Central Bank, Insurance Authority, Securities and Exchange Commission or any other enacted financial regulator. This sector is mainly represented by Specialized Financial Institutions like House Building Finance Corporation (HBFC), Palli Karma Sahayak Foundation (PKSF), Samabay Bank, Grameen Bank etc., Non Governmental Organizations (NGOs and discrete government programs. The informal sector includes private intermediaries which are completely unregulated. | | | Related links About financial markets | Regulators | Bank & FIs | Capital market | Insurance | Micro Finance Institutions (MFIs) | Recent developments | Key financial indicators | Print this page | | | | | Financial System of Bangladesh | Formal Sector | Semi Formal Sector | Informal Sector | Financial Market | Money Market ...
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...Introduction--------------------------------------------------------------------------------------------Page 2 Company Background AB Bank----------------------------------------------------------------------------------------Page 2 Beximco Pharmaceuticals--------------------------------------------------------------------Page 3 British American Tobacco--------------------------------------------------------------------Page 4 Monno Ceramics-------------------------------------------------------------------------------Page 4 National Bank----------------------------------------------------------------------------------Page 5 Padma Oil---------------------------------------------------------------------------------------Page 5 Singer Bangladesh-----------------------------------------------------------------------------Page 6 South East Bank-------------------------------------------------------------------------------Page 7 Standard Ceramics----------------------------------------------------------------------------Page 7 Square Pharmaceuticals-----------------------------------------------------------------------Page 8 Findings and Analysis Arithmetic Mean and Standard Deviation--------------------------------------------------Page 9 Correlation Coefficient and Covariance----------------------------------------------------Page 9 Portfolio Risk and Return-------------------------------------------------------------------Page 11 Efficient Frontier-------...
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