United News of Bangladesh

Bangladesh's stockbrokers have called on the capital market regulator to immediately withdraw floor prices from the country's equity market, warning that the artificial price mechanism is choking trading activity and eroding investor confidence. The DSE Brokers Association of Bangladesh (DBA) made the demand on Monday in a formal letter addressed to Bangladesh Securities and Exchange Commission (BSEC) Chairman Khondoker Rashed Maqsood, urging the regulator to lift the price floor without further delay to restore normal market operations. Signed by DBA President Saiful Islam, the letter highlighted that floor price restrictions have left listed conglomerate Beximco Limited virtually untradeable for an extended period. It also noted that shares of Islami Bank Bangladesh PLC and other floor-priced stocks were trading at their floor levels on May 3, effectively blocking sellers from executing normal transactions. The association further flagged that prolonged trading restrictions tied to floor prices are heightening the risk of negative equity for margin loan borrowers, a development it described as a growing threat to overall market stability. DBA also cautioned that such artificial price controls are projecting a negative image of Bangladesh's capital market to international investors, potentially undermining foreign participation at a time when the market needs fresh inflows. It called on BSEC to promptly lift the floor price on all affected securities and allow the market to function freely, emphasising that a return to price discovery-driven trading is essential for restoring investor confidence and market dynamism. A floor price is a regulatory mechanism that sets a minimum trading level for a stock, preventing its price from declining further. BSEC has previously imposed such controls during periods of sharp market downturns.