BSEC moves to speed up trade settlement cycle

The country’s capital market regulator has asked authorities concerned to take measures to speed up the standard trade settlement time for ‘A’ and ‘B’ categories by adopting the T+1 cycle.

In this regard, the Bangladesh Securities and Exchange Commission (BSEC) on Sunday sent letters to the Dhaka Stock Exchange (DSE), Chittagong Stock Exchange (CSE) and Central Depository Bangladesh Limited (CDBL).

The letters asked both the exchanges and CDBL to come up with a plan within the next seven days on how to implement the T+1 cycle.

They have also been asked to provide a roadmap for amendments to the Rules and Regulations, system modifications and other necessary changes needed for the implementation of the new settlement cycle.

Once it is implemented, investors will be able to sell their securities one business day after the transaction.

At present, the country’s bourses follow the T+2 settlement cycle which allows investors to complete trade settlements after two days of purchase.

The move is aimed at making investment easier and following international standards.

Dr Shaikh Shamsuddin Ahmed, a commissioner of the BSEC, said that preparations are being made to launch a T+1 settlement in order to build an international standard stock market that will be conducive to all.

This will increase the flow of money in the stock market and will make the stock market accessible to all investors including foreigners, he added.

The BSEC commissioner said that foreigners are accustomed to T+1 settlement, and to make investments, they want local bourses to adopt the cycle too.