The Bangladesh Securities and Exchange Commission (BSEC) has approved the plans to float three new mutual funds in its bid to strengthen the institutional investment base in the capital market.
After the 799th commission meeting on Tuesday, the capital market regulator said of the three funds, two would be open-ended funds to be sponsored by HF Asset Management and Bangladesh Race Management Private Company Ltd, while the other would be a closed-end one with a tenure of 10 years.
The closed-end mutual fund would be sponsored by the Capital Market Stabilisation Fund which has been built out of the un-disbursed dividends stuck in listed firms and intermediaries.
ICB Asset Management would be the issue manager of the closed-end mutual fund - which will be named "Golden Jubilee Fund" to celebrate 50 years of Bangladesh's independence. The sponsor would provide Tk50 crore to the fund while investors would subscribe to its public offers to make the fund bigger and later, the fund would be traded in the bourses, BSEC said in its statement.
On the other hand, HF Asset Management Shariah Unit Fund will get Tk2.5 crore from its sponsor which would also manage the fund assets. The fund would collect investments from the public to fulfil the target size of Tk25 crore.
Bangladesh Race Management Private Company Ltd fund will also have the same amount of sponsor investments with the same target size.
Open-ended funds are not tradable in the stock exchanges and investors instead buy and sell the fund units directly with the asset manager or their authorised agents.
BSEC also announced the rewarding of the three most efficient firms operating in brokerage, stock dealing, merchant banking, and asset management industries to celebrate the Golden Jubilee of Bangladesh.