BSEC to take tougher action
Staff Correspondent: Bangladesh Securities Exchange Commission (BSEC) is going to take action against the directors who have been found non-compliant with the mandatory two per cent shareholding directives. BSEC identified them as they are running the companies illegally without any holding of shares or stake.
As per the directives, the directors are required to inject around Tk 1,500 crore in the capital market to comply the rules.
Earlier, Dhaka Stock Exchange submitted to the commission a list of 219 individual directors of 78 listed companies at the two stock exchanges who were not holding minimum two per cent shares of the respective companies’ paid-up capital as of June.
Senior officials of the BSEC have said that the commission is planning to start the process of taking action against the errant directors in the wake of its move to take action against the companies whose directors jointly are not holding 30 per cent shares of the companies.
The commission may call for hearing each of the errant directors to get the reasons behind their failure to hold minimum shares, a BSEC official has said, however, adding that it will take time to take action against those directors due to the lengthy process.
According to the BSEC notification issued on November 22, 2011, each director other than independent director of any listed company must hold minimum two per cent shares of the company’s paid-up capital otherwise there will be a casual vacancy of director.
On February 13, BSEC decided to take legal action the errant directors who do not hold at least 2 per cent shares of their companies breaching securities rules.
According to the list of DSE investigation, 11 directors of six banks have to inject around Tk 400 crore to cover up their lack of share ownership as they are holding not more than 0.01 per cent of their respective companies’ paid-up capital.
They are Uttara Bank’s directors Tofazzal Hossain, Abdul Barq Alvi, M Tajul Islam, MS Kamal, Faruque Alamgir and Shaikh Adul Aziz while AB Bank director MA Awal, Dutch Bangla Bank director Fakrul Islam, Social Islami Bank director Abdur Razzaque, Southeast Bank director Sirat Monira and Export Import Bank sponsor director Abdul Mannan.
A total of 145 directors from 40 insurance companies have to inject around Tk 650 crore to maintain their directorship.
Among the insurance companies, National Life Insurance company’s 10 directors are required to inject around Tk 280 crore in the market to comply with the BSEC directives.
Summit Power directors Helal Uddin Ahmed and Syed Fazlul Haque hold 0 per cent shares, which has called their directorship into question.
The BSEC took the step as it was found that the persons who did not have any shares into a listed company became its directors.
Around 70 among the 219 directors were found to hold directorship with nominal shares.
Among them are Family Textile director Jun Kyang Won (0.00 per cent), Golden Son directors Lin Wan-Yi (0.03 pc), Ha Mong Chi/Abel Ahmed (0.05 pc), Sonargaon Textiles director Nazmul Bari Chowdhury (0.00pc), Dulamia Cotton Spinning Mills directors Mahbub Alam (0.15pc) and Shahnul Bari Chowdhury (0.00pc), Easter Cables directors Afsar Uz Zaman (0.08 per cent), and Nasir Uddin Chowdhury (0.06per cent), Fu-wang Food directors Kamal Kanti Mondal (0.00 per cent) and Biplob Chakraborty (0.03 per cent).
Managing Director of Sonargaon Textiles Limited A K M Azizur Rahman told that Nazmul Bari Chowdhury is a nominated director of Bangladesh Development Bank Ltd, as the bank holds a remarkable number of shares of the company. Mr. Bari is no longer in BDBL and the bank has replaced another director, he added.
Besides, IBN SINA Pharmaceuticals director SK Bahar Hossain (0.01 per cent) and Shah Bulbul Islam (0.03 pc), Intech Ltd directors, Shadika Mahbub (0.40 per cent) and Anisuzzaman (0.04 per cent). Information Services directors Kaisar Ali Talukdar (0.04 pc), Akhtaruzzaman (0.08 pc), Mostafa Akbar (0.10pc), Modern Dyeing director Dewan Nuruzzaman (0.19pc), Meghna Petroleum director Masudur Rahman (0.00pc), National tubes directors Mazibur Rahman Khan (0.01pc), Saiful Islam (0.20pc), Pujada Tarab Hossain (0.05pc) and Umma Kulsum (0.24pc) have nominal shares.
The BSEC has recently directed the bourses to ensure that all the listed companies comply with the rule regarding all-time joint-holding of minimum 30 per cent shares by each company’s sponsor-directors and asked them to take immediate moves in this regard.