Investor dissatisfaction mounts as market turmoil persists under current BSEC leadership

Infographic: TBS

Investor frustration in the stock market has intensified amid extreme volatility, prolonged downturns, and growing dissatisfaction with reforms led by Bangladesh Securities and Exchange Commission (BSEC) Chairman Rashed Maksud.

Many investors had hoped for stability following the fall of the Sheikh Hasina government last year and the arrival of the interim administration. Instead, political uncertainty and economic pressures have coincided with policy decisions that market participants say have failed to restore confidence.

Market volatility has worsened, capital erosion continues, and calls for the resignation of the BSEC chairman and commissioners have grown louder across the market.

Recently, rumours have also circulated that the Ministry of Finance may soon replace the chairman.

According to market chatter, Rashed Maksud could be appointed to a new bank formed through a merger of five Islamic banks currently suffering from liquidity stress. Market sources suggest that some progress has already been made on this plan.

On Sunday, the benchmark DSEX index plunged 82 points early in the session but later rebounded by 112 points as rumours of leadership change spread.

Fundraising freeze fuels frustration

Market insiders say fundraising through the capital market has been at a standstill for about 15 months. The prolonged absence of new company listings has also dampened investor enthusiasm, negatively affecting both the primary and secondary markets. The bond market has also been affected.

Experts and merchant bankers warn that the prolonged freeze has pushed businesses towards bank borrowing instead, tightening liquidity in the market and further weakening investor sentiment.

Investors protest in the streets

Concerns have mounted since the appointment of the current chairman, with many investors reporting declining confidence in his performance as the market remains under pressure. Continuous market declines have prompted investors to take action to limit losses.

The situation escalated over the past week, with some investors staging symbolic street protests. 

On Sunday afternoon, protesters demanded the immediate removal of BSEC Chairman Rashed Maksud, the repeal of the Margin Loan Rules 2025 and Mutual Fund Rules 2025, and the prompt return of share values from the merged five banks to investors. 

They also called for the resignation of the entire commission, accusing it of failing to protect investors.

Additional demands included rooting out corruption within the regulator, arresting those responsible for alleged misappropriation in the stock and mutual fund markets, and suspending trading until stability returns.

Internal tensions within the regulator

Discontent is also brewing inside the BSEC regarding the chairman's overall performance.

Officials say frustration peaked in March, when staff staged a work stoppage demanding the resignation of senior leadership. 

In response, the BSEC suspended 21 officials and initiated legal action against 16 others. Officials now describe a paralysed working environment, with many reluctant to take initiative for fear of repercussions.

Important files remain pending, and even entrepreneurs seeking meetings with the chairman face long delays, several officials told TBS on condition of anonymity.

Entrepreneurs lose trust

Entrepreneurs, too, report diminishing confidence in the regulator's ability to support capital raising.

One, speaking anonymously, told TBS, "I want to raise funds from the capital market, but I have no confidence in the commission. Their actions are disappointing, and unless the situation improves, I will have to explore alternative financing options."

Merchant bankers report that the country's poor economic conditions over the past few years have reduced entrepreneurs' interest in fundraising through the capital market. 

Many have faced long delays despite submitting applications, forcing them to postpone business plans. The lack of confidence in the current commission has compounded the problem.

Market rebounds after early plunge

The Dhaka Stock Exchange (DSE) staged a strong recovery yesterday, clawing back early-session losses after a sharp decline at the start of the week. 

The DSEX index fell 82 points in the morning amid heavy sell pressure but gradually regained momentum, ultimately recovering 112 points from the day's low. 

By the closing bell, DSEX ended 29 points higher at 4,732 points, while the blue-chip DS30 index gained 9 points to settle at 1,860.
Market breadth turned positive, with 236 advancing issues, 113 declining, and 35 unchanged. 

Despite the recovery in the indices, investor participation remained subdued. Daily turnover fell by 22% to Tk 298 crore, reflecting ongoing caution among market participants.

EBL Securities, in its daily market commentary, noted that the broad index managed to reverse its earlier losses as late-session bargain hunting provided a cushion, limiting the market's free fall amid lingering investor concerns over momentum. 

Although the session started on a bearish note, with DSEX shedding 82 points within the first 30 minutes, the market gradually recovered as opportunistic investors accumulated beaten-down stocks, perceiving them as attractively priced. This activity helped the broad index claw back early losses and close in positive territory.