All quarters must pitch in if a dynamic capital market is to be built up, discussants said at a seminar.
At the seminar, organised by Dhaka Chamber of Commerce and Industries (DCCI) on Saturday, speakers presented papers on the recent stock market debacle and suggested measures for prevention of such incidents.
Dhaka University professor Salahuddin Ahmed Khan presented a paper on demand-side constraints in the capital market, while DCCI director Waqar Ahmed Choudhury presented one on supply-side limitations.
The discussants in the papers opined that low supply of shares and lack of quality shares caused overvaluing of the market.
They felt that the Securities and Exchange Commision (SEC) would have to be independent if it were to become an effective regulatory body for the capital market.
They said the government interfering 'every now and then' was not good for the market, and the policies following the recent crash, coupled with the failure to implement recommendations, adversely impacted the market.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Shafiul Islam Mohiuddin said the wage structure for SEC employees was so low that they could be easily bought off.
"Efficient officers from the private sector do not want to come here because of low wages," he added and insisted that the problem should be addressed immediately.
Dhaka Stock Exchange president Shakil Rizvi said bank loan interest rates were a prime determinant of the stock market.
"Increase in interest rates of commercial banks has taken a lot of money out of the capital market," he said.
"Supervision alone cannot regulate the market. Government policies, NAV and financial statements also affect the price," he added.
Chartered accountant Adib H Khan emphasised the importance of financial statements in the capital market.
"These things determine the prices of shares, but many statements are forged through corruption. The SEC alone cannot supervise all the reports. An effective system needs to be in place," he said.
Many speakers blamed the government for not taking timely measures. The SEC had been without a quorum for over a month, they pointed out.
Dhaka University professor Mahmud Osman Imam, CPD senior research fellow Khandker Golam Moazzem and heads of different investment firms also spoke at the seminar.
At the seminar, organised by Dhaka Chamber of Commerce and Industries (DCCI) on Saturday, speakers presented papers on the recent stock market debacle and suggested measures for prevention of such incidents.
Dhaka University professor Salahuddin Ahmed Khan presented a paper on demand-side constraints in the capital market, while DCCI director Waqar Ahmed Choudhury presented one on supply-side limitations.
The discussants in the papers opined that low supply of shares and lack of quality shares caused overvaluing of the market.
They felt that the Securities and Exchange Commision (SEC) would have to be independent if it were to become an effective regulatory body for the capital market.
They said the government interfering 'every now and then' was not good for the market, and the policies following the recent crash, coupled with the failure to implement recommendations, adversely impacted the market.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Shafiul Islam Mohiuddin said the wage structure for SEC employees was so low that they could be easily bought off.
"Efficient officers from the private sector do not want to come here because of low wages," he added and insisted that the problem should be addressed immediately.
Dhaka Stock Exchange president Shakil Rizvi said bank loan interest rates were a prime determinant of the stock market.
"Increase in interest rates of commercial banks has taken a lot of money out of the capital market," he said.
"Supervision alone cannot regulate the market. Government policies, NAV and financial statements also affect the price," he added.
Chartered accountant Adib H Khan emphasised the importance of financial statements in the capital market.
"These things determine the prices of shares, but many statements are forged through corruption. The SEC alone cannot supervise all the reports. An effective system needs to be in place," he said.
Many speakers blamed the government for not taking timely measures. The SEC had been without a quorum for over a month, they pointed out.
Dhaka University professor Mahmud Osman Imam, CPD senior research fellow Khandker Golam Moazzem and heads of different investment firms also spoke at the seminar.
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