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The Bangladesh Bank on Monday asked the scheduled banks to bring down their capital market investments to permitted limits by December 31, 2023.
The department of off-site supervision of the central bank issued a circular in this regard on the day.
As per the Bank Companies Act, the scheduled banks are allowed to invest in listed securities up to 25 per cent of their equity on a solo basis and 50 per cent on a consolidated basis.
According to Monday’s BB circular, the scheduled banks which had investments beyond the limit in the stock market as on August 31, 2022 are asked to adjust their investments by December 31, 2023.
On August 4, the central bank issued instructions to calculate scheduled banks’ stock investments based on the cost price instead of the market price of their shares.
The purchasing price of shares of other companies, mutual funds, debentures and corporate bonds will be considered during the counting of the highest exposure limit of banks, it said.
(NA)
