BSEC rejects Standard Bank’s plan to raise funds thru’ bond
The bond’s issuance was subject to approval from both the BSEC and the Bangladesh Bank
The Bangladesh Securities and Exchange Commission (BSEC) has rejected Standard Bank's proposal to raise Tk500 crore through the issuance of a subordinated bond.
After receiving board approval, the private lender announced its plan in late July to float a floating-rate, non-convertible Mudaraba subordinated bond aimed at strengthening its Tier-2 capital base to meet Basel-III requirements.
The bond's issuance was subject to approval from both the BSEC and the Bangladesh Bank.
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However, last week the market regulator turned down the proposal, stating that it was not in a position to process the bond issuance application.
The decision was disclosed on the Dhaka Stock Exchange (DSE) website today (2 November).
Following the BSEC rejections of bond issuance, Standard Bank's share price declined yesterday by 1.89% to Tk5.20 each at the Dhaka Stock Exchange (DSE)
Currently, the local bond market is dominated by subordinated bonds, mainly issued by banks.
The bonds help lenders construct their mandatory tier-2 capital base through proceeding within a specific tenure.
The Bangladesh Bank is implementing the Basel-III framework to ensure that banks maintain adequate capital and reduce systemic risks.
Basel-III is an international regulatory accord that introduced a set of reforms designed to mitigate risk within the international banking sector by requiring banks to maintain proper leverage ratios and keep certain levels of reserve capital.
Standard Bank reported a 40% decline in its consolidated earnings per share (EPS) to Tk0.74 in 2024, compared with Tk1.24 in the previous year. The bank has also decided not to pay any dividend for its shareholders for 2024.
In contrast, during the first nine months of 2025 (January–September), the bank's consolidated profit grew by 7.6% to Tk57.62 crore, with earnings per share (EPS) of Tk0.52.
Its consolidated net operating cash flow per share rose sharply by 542% to Tk8.86 during the same period, up from Tk1.38 a year earlier.
The bank reported a significant improvement in cash flow, attributing it to several factors: a sharp rise in deposits, higher placements from other banks, increased investment income, substantial gains from investments in shares and securities, and a reduction in operating expenses.
