The Bangladesh Securities and Exchange Commission (BSEC) has capped the limit of how much assets a trustee of bonds can oversee.
According to a BSEC directive on Tuesday, a licensed trustee firm can take care of traditional bonds and Islamic asset backed securities including Sukuk worth up to 100 times of the trustee company's paid up capital net worth.
If the trustee firm's net worth is less than its paid-up capital the ratio will be 75 times, the capital market regulator said, to reduce the risks regarding depending on a trustee that itself struggles financially.
A trustee firm cannot serve more than 40 bonds and Sukuk simultaneously.
A trustee of securities is responsible to oversee assets to ensure the investors' protection.
BSEC also set some criteria for the trustee firms for debt or Islamic securities to ensure the quality of their services.
A trustee firm must have a qualified legal advisor with expertise in corporate and securities law and five years of experience, a Shariah advisor with knowledge of Islamic fiqh and five-year experience in Islamic finance to serve in the Islamic securities arena.
A compliance officer of trustee firms will not work on more than 10 securities.
Trustee firms must not have any loan defaulter in their board, while the BSEC will keep an eye on the profiles of trustee members.