UCB cancels plan to sponsor new mutual fund

The board of United Commercial Bank PLC (UCB) has reversed its earlier decision to invest Tk50 crore as the sponsor of a proposed closed-end mutual fund, according to a regulatory disclosure shared by the bank through the Dhaka Stock Exchange (DSE).

In the disclosure, the private sector lender, which recently underwent substantial changes in its board composition due to the government transition, cited "the prevailing market situation" as the reason for the cancellation.

On 28 May, UCB announced that its board of directors had decided to sponsor a new closed-end mutual fund, which would be managed by CAPITEC Asset Management Limited.

It was planned to be a growth mutual fund that tends to prefer investing in companies having significant growth potentials in their respective businesses eying hefty capital gains.

UCB was under the control of the family of the former land minister Saifuzzaman Chowdhury Javed during the Awami League regime.

Following the ouster of the Sheikh Hasina-led government on 5 August, the Bangladesh Bank, on 27 August, dissolved the previous board of the bank and formed a new one onboarding Sharif Zahir as a director and the chairman, Md Shazzad Hossain as the independent director and vice chairman, Md Tanvir Khan as a director and executive committee chairman, Obaidur Rahman, FCA as an independent director and chairman of the audit committee, and Md Yusuf Ali as an independent director and the chairman of the risk management committee.

UCB posted earnings per share of Tk0.86 for the first six months of this year, which was Tk0.65 for the same period of 2023.

UCB shares having a face value of Tk10, closed 0.82% higher at Tk12.3 on the DSE on Thursday.