Professional Documents
Culture Documents
Bangladesh
PREPARED BY:
MD. AZHARUL ISLAM
ID: 082-12-0043
SECTION: 4B
Introduction
The driving force of an economy is the capital market. Capital market is for borrowing
and lending long-term funds for more than one year. Capital market has to parts:
security segments and non-security segments. The securities segment is concerned
with the process by which distribute securities. The non securities segments are
those where banks and other financial institutions provide loans. The deficit units or
the business farms need money to pay the production factors like: land, labor, capital
and entrepreneur. And the surplus units or house holds have outstanding earnings.
Here capital works as a financial intermediary that pools the money from a wide
number of people and channels it to the ultimate user.
The regulatory organization of Bangladesh Capital Market is the Security Exchange
Commission in short SEC. Under the Security and Exchange Commission act 1993, it
was formed as a capital market regulator. It ensures proper issuance of securities,
protection of the interest of investors in securities, development of the capital and
security market and regulation of the capital and securities markets in Bangladesh.
There are two Stock Exchange in Bangladesh: Dhaka Stock Exchange (DSE) and
Chittagong Stock Exchange (CSE).
Problem Statement
Bangladesh is a small country with huge population. But the capital market
of Bangladesh is small, incompetent and underdeveloped. In our country
non securities part accounts for more than ninety percent of the total
financial activities. There are 3000 public limited companies. But only 263
companies are enlisted their name in Securities and Exchange Commission
(SEC). So the large numbers of companies are not listed in Securities and Exchange
Commission. As a result percentage of GDP in our country is only 5%
whereas the ratio in India 46% Pakistan 17% and in Malaysia 324%. The
rate of Industrial investment is also very Low in our country, where the other
developing countries average rate of GDP is 50%. Our capital market has
not yet reached the reliability. The most visible problems of capital market in
Bangladesh are serious death of risk-free assets in the secondary market to
individual buyer, unfair treatment of the investor (Maltreating and
Manipulation), lack of market information, absence of variable tradable
financial instrument.
Financial Market
Money Market
Capital Market
Security Market
Primary Market
Non-security
Market
Secondary Market
of Security Market
Market
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