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All mutual funds made robust growth in earnings and declared hefty dividends for their unitholders for the financial year 2021 due mainly to bullishness in the country’s stock market.
According to asset management companies’ data, 30 out of 36 listed MFs declared dividends and earnings for the year ended on June 30, 2021.
Of the 30 closed-end mutual funds, 20 mutual funds returned to profits in the past financial year from significant losses incurred in the previous fiscal year and declared hefty dividends for their unitholders.
Earnings per unit of other 11 MFs also advanced in FY21 compared with that of FY20 as no MF saw fall in EPU in 2021.
Officials of asset management companies said that the funds had faced significant losses in the previous year due mainly to a prolonged sluggish market and coronavirus fallout in the country.
However, the market has rebounded strongly since July 2020 and the trend continues without any pause.
The strong market recovery helped the mutual funds generate profits and announce better dividends for their unitholders, they said.
The market has been rising since the beginning of the financial year 2021 due to a host of reasons, including rising investor confidence in the stock market amid some recent moves taken by the Bangladesh Securities and Exchange Commission.
The current commission under the leadership of Shibli Rubayat-Ul-Islam has taken some reform steps and disciplinary actions against wrongdoers.
The core index of Dhaka Stock Exchange, DSEX, gained 54.18 per cent, or 2,161 points, to close at 6,150.48 on June 30, 2021 from 3,989.08 points on June 30, 2020.
The 20 MFs which recovered from losses are First Janata Bank MF, AB Bank 1st MF, ATCSL Growth Fund, CAPM BDBL MF-1, CAPM IBBL Islamic MF, DBH 1st MF, EBL 1ST MF, EBL NRB MF, Exim Bank 1st MF, First Bangladesh Fixed Income Fund, Green Delta MF, IFIC 1st MF, MBL 1ST MF, NLI 1st MF, Popular Life 1st MF, Reliance One, PHP 1st MF, SEML Lecture Equity Management Fund, SEML IBBL Shariah Fund and Trust Bank 1st MF.
Out of the 30 MFs, 29 declared more than 5 per cent while 14 MFs declared more than 10 per cent cash dividends for FY21.
Only IFIL Islamic Mutual Fund-1 announced 4 per cent cash dividend.
The BSEC on July 16, 2019 barred asset management companies from declaring bonus dividend for the mutual funds’ unit holders.
Most AMCs used to declare stock dividends, hurting the interest of the unit holders.
NLI 1st MF declared highest dividend of 17.5 per cent cash dividend followed by Asian Tiger Sandhani Life Growth Fund 15 per cent, SEML Lecture Equity Management Fund 15 per cent, SEML FBLSL Growth Fund 15 per cent, CAPM IBBL Islamic MF 13.5 per cent, CAPM BDBL MF-1 13 per cent, Grameen Scheme Two 13 per cent, EBL 1ST MF 13 per cent, First Janata Bank MF 13 per cent, Green Delta MF 12 per cent and MBL 1st MF 11.5 per cent.
Reliance 1st MF declared the highest earnings per unit of Tk 4.06 followed by, NLI 1ST MF Tk 3.14, SEML Lecture Equity Management Fund Tk 2.84, AB Bank 1st MF Tk 2.61 and EBL 1ST MF Tk 2.61.
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