DHAKA, Feb 15, 2020 (BSS) – Asian Development Bank (ADB) will provide
second tranche loan of US$170 million to conclude the third capital market
development programme (CMDP) in Bangladesh.
“ADB’s long-term engagement through its CMDP has transformed legal,
regulatory and institutional market frameworks in line with government’s
development priority to mobilize long-term financing for productive
investments, such as infrastructure and sustained economic growth toward
middle-income status,” said ADB Financial Sector Specialist Takuya Hoshino.
ADB approved the programme totaling US$250 million in November, 2015 with a
first tranche US$80 million loan to support vital capital market reforms
accompanied by a technical assistance grant of US$700,000, out of which
US$300,000 was financed by Korea’s e-Asia and Knowledge Partnership Fund to
assist implementation of the reform actions, said ADP Press release received
here today.
ADB has been actively supporting government’s current capital market
reform agenda since 2012 when the second CMDP was approved. It is aimed to
rebuild market confidence after stock market turbulence in December 2010 and
put the capital market back onto a sustainable development path.
The programme resulted in the 10-year national capital market development
master plan and critical legislations for ensuring the independence of the
Bangladesh Securities Exchange Commission (BSEC) as a regulator,
demutualizing the two stock exchanges, better corporate governance, more
reliable financial reporting and auditing, and insurance sector development.
The third CMDP was introduced in 2015 to build on the foundation
established under the second programme to broaden and deepen the reach of the
reforms and overcome remaining constraints in sustainable market development.
It focused on the actual implementation of regulatory and institutional
reforms, such as for strengthening regulatory and supervisory capacity of
BSEC, establishing a risk-based capital framework for market intermediaries,
enhancing the clearing and settlement system, introducing new financial
instruments by the two demutualized stock exchanges, establishing a Financial
Reporting Council and strengthening governance of the insurance sector.