The securities regulator is set to enhance the IPO quota for general investors aiming to facilitate their greater access to such facility.
To this effect, the Bangladesh Securities and Exchange Commission (BSEC) has already incorporated such provision in its draft amendments to the public issue rules.
"The BSEC has enhanced the IPO quota for general investors considering their greater interest. General investors have also demanded the enhancement of their IPO quota," said Mohammad Rezaul Karim, a BSEC spokesperson.
As per the existing rules, the general investors have 50 per cent and 40 per cent IPO quota under the fixed price and book building method respectively.
As per the new amendment, if approved, the general investors will avail 65 per cent quota both in fixed price and book building method.
In its draft amendment, the securities regulator has also included the provision of offering private placement up to 15 per cent of the size of IPO at par value under the fixed price method or at cut-off price under the book building method.
And the shares offered as private placement will be treated as a part of the IPO.
The previous commission scrapped the option of private placement following the misuse of such shares widely issued before the 2010-11 stock market debacle.
Asked, the BSEC commissioner Dr. Shaikh Shamsuddin Ahmed said the provision has been included to facilitate the listing of good companies.
"Previously, there was no specific rules to contain the misuse of placement shares. Now, the companies will not able to misuse the placement shares as we have enhanced monitoring," said the BSEC commissioner Mr. Ahmed.
In the draft rules, the securities regulator has also included the provision of submitting VAT returns and certified bank statements with the IPO proposals.
"We are to take into account any kind of bank statements provided with the IPO proposals. That's why, we have included the provision of submitting certified bank statements to get proper information regarding the transactions of the issuers," the BSEC commissioner Mr. Ahmed said.
The securities regulator has also enhanced the lock-in period on placement shares to two years from existing one year.
The regulator has imposed one year lock-in period on the shares to be held by the foreign shareholders.
Meanwhile, the securities regulator has sought public opinion on the draft amendment brought the public issue rules.
