SEC restricts floatation of mutual funds below tk 50cr

The stock market regulator will not allow floatation of any mutual
fund below Tk 50 crore. Fund managers hailed the initiative to fix
the minimum size of a fund in order to make it cost effective.
Issue, management and financial costs are higher for a small size
mutual fund in proportion with larger ones, said the Securities and
Exchange Commission, which fixed the minimum size at a meeting
yesterday. "Besides, it will ensure qualitative supply of investment
securities in the market," Ziaul Haque Khondker, chairman of SEC,
told The Daily Star after the meeting. Prior to the new rules, there
was no ceiling in mutual fund sizes. "It's a welcome move. It will be
cost effective for mutual fund floatation and management," said
Yawer Sayeed, managing director of AIMS of Bangladesh, an asset
management company. In yesterday's meeting, the SEC decided that from
now on no company can hold board meeting during the trading session
if the meeting is expected to take any price sensitive decision such
as dividend and financial statement. The company can hold the meeting
after trading hours or on holidays.