# BSEC will take action if dividend is not paid: Rezaul Karim
# No good news for investors: Union Bank Secretary
# Central Bank has nothing to do: Majbaul Haque
# Ex-FBCCI President's bank share price at rock bottom
# Banks getting weaker by withdrawing IPO approval money
The share market is also shadowed by weak banks. Mismanagement, arbitrariness of directors, audit weakness, regulatory agencies and central bank's legal complications have caused banks' share prices to fall below face value and become a thorn in the neck of investors. Ordinary investors cannot sell the shares bought with difficulty. Those who are selling are also losing huge amounts of capital. The list of banks whose share price is below face value includes the names are ICB Islami Bank, AB Bank, Global Islami Bank, Union Bank and One Bank. Currently, the share price of some banks has fallen to around Tk 7.
Investors said that we are losing capital today because of weak bank management, arbitrariness of managers, and lack of monitoring by regulatory agencies. Share prices of five banks have been below face value for a long time. BSEC and DSE are not taking any effective steps to control the situation. Gamblers blame the regulatory agencies! Ordinary investors are destitute. Why is the commission not taking action to catch those who are manipulating the market? They are no longer 'aliens' who cannot be caught and touched.
A perusal of the Dhaka Stock Exchange (DSE) website shows that Union Bank last gave only 5 percent cash dividend to investors in 2022, AB Bank gave 2 percent bonus dividend in 2022, Islamic Shariah-based Global Islami Bank gave 10 percent cash and bonus dividend in 2022, One Bank gives 5 percent bonus dividend in 2020. However, no information about the payment of cash and bonus dividends of ICB Islami Bank was found on the website of DSE. Since then, the share price of the banks has been falling.
Dhaka Stock Exchange (DSE) has nothing to do about why banks are getting weaker after being listed in the capital market. DSE Chairman Professor Dr Hafiz Muhammad Hasan Babu's mobile phone was called several times to talk about it, but he did not receive the call.
Among the discussed banks, Union Bank's share price of Tk 10 is now Tk 6.50 paisa. The bank was established in 2013. Then on September 5, 2021, in the 790th commission meeting of BSEC, Union Bank raised Tk 428 crore through the issue of 42.8 million ordinary shares from the stock market through initial public offer or IPO. Company Secretary Ali Hossain Bhuiyan said that even though the share price has been below the face value for a long time, he is not able to give any hope to the investors. He said, 'It is a matter of management, I cannot comment on it. But there is June closing ahead, and then maybe investors can get some good news.
Global Islami Bank, another bank below the face value, is now trading at 6.50 paisa per share of Tk 10. That is, investors have already lost Tk 3.50 paisa per share. Global Islami Bank on June 15, 2022 as a fourth generation bank has been approved by BSEC to raise Tk 425 crore from the stock market through IPO. Prior to this, the Central Bank approved a full-fledged Islamic Shariah-based bank in 2020 whose owner is Jasim Uddin, the President of FBCCI and Vice Chairman of Bengal Group.
The second generation Oriental Bank or today's ICB Islami Bank started operations in 1990. However, since the beginning of the operation, there have been various irregularities in Oriental Bank. Later on, ICB started operations as Islami Bank in 2004. Now each share of Tk 10 of the company stands at Tk 3.30 paisa. In other words, the investors lost 6 taka 70 paisa per share. Common investors have 25.46 percent shares in this bank.
The share price of the country's first private bank AB Bank is also below the face value. It was formed as the first private commercial bank in the country to set sail on 31 December 1981 which started banking operations on April 12, 1982. Currently the share price of the bank is Tk 7. The company paid a 2 percent stock dividend to investors in 2022. Despite calling AB Bank's Managing Director and Chief Executive Officer Tarek Afzal multiple times and sending SMS on his mobile phone, no reply was received. Besides, when the company secretary was called, he also did not receive the call.
Meanwhile, One Bank's shares of Tk 10 each have come down to Tk 7. The company secretary John Sarkar had been called several times but he did not pick up calls.
Ahmed Rashid Lali, the former senior vice-president of DSE, said that, "The paid-up capital of the banks is more than Tk 700 to 2000 crore. Moreover they (banks) are well regulated through Bangladesh Bank and Audit Firms. Investors have nothing to panic about. Investors will get a lot of money even if they gain two taka here. But here it takes time to gain capital.
What should the investors of companies do with share prices below face value now?
Saidur Rahman, the former president of Bangladesh Merchant Bankers Association (BMBA) said, "It would be better for ordinary investors to invest in companies that give good dividends." However, BSEC's decision is final for those whose share price is below face value.
When asked what measures Bangladesh Securities and Exchange Commission (BSEC) is taking regarding the bank companies whose share price is below the face value for a long time, BSEC Executive Director and Spokesperson Mohammad Rezaul Karim said that BSEC has nothing to do if the share price of a bank is below the face value. However, the banks have to answer to the central bank as the primary regulator. However, if the bank does not pay dividend for a long time, BSEC issues a show cause notice to the banks. Now the market is slightly down, if it moves to the upper end, the share price will also increase.
Bangladesh Bank Spokesperson and Executive Director Md Majbaul Haque refused to comment on the matter.
So far, 43 banks of the country have invested Tk 16 thousand 314 crore in the capital market. Despite all the opportunities, three government banks Sonali, Janata and Agrani are not listed in the capital market for unknown reasons.
ZH
