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any company to be grouped or remain in 'A' category without having
dematerialised their shares from January 1 next year, said officials. The
stock market regulatory body made the decision at a meeting on Tuesday. SEC
chairman Ziaul Haque Khondker presided over the meeting. 'The companies
which are already in the category without having dematerialised form of
shares will have to transfer their paper shares to electronic system by the
time to remain in the category,' SEC executive director Anwarul Kabir
Bhuiyan told reporters. He said, 'Currently shares of 29 ' A' category
companies are not dematerialised.' 'If they fail to dematerialise their
shares by the time, they will be downgraded to ' B' category,' he said.
As on Tuesday there were 177 companies in 'A' category that accounted for
84.63 per cent of total market capitalisation of Dhaka Stock Exchange,
sources in the DSE said. The dematerialising of share means transfer of
paper shares to electronic system. Demat trading or script-less trading
makes share transaction more transparent, said the SEC official. The
Central Depository Bangladesh Ltd, which operates CDS, got certificate from
SEC on December 23, 2003 to maintain electronic book entry, recording and
securities accounts and registering transfer of securities, changing the
ownership. As on Tuesday, the dematerialised shares accounted for 97.03
per cent of market capitalisation of the DSE. The SEC also decided to
forfeit 10 per cent of application money of investors who applied for
initial public offerings of three companies from more than two accounts each
- one single account and one joint account - in violation of securities
laws. 'We have found that IPOs of Bay Leasing and Investment, Asia
Insurance and Rupali Life Insurance saw illegal applications worth of
Tk 2.10 crore, Tk 70.53 lakh and Tk 1.45 crore respectively,' the official
said. As per rules, an investor is allowed to apply for IPO only with a
single account and a joint account.
