The document discusses the stock markets of Bangladesh, including the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE). It notes that the DSE is the main stock exchange located in Dhaka, while the CSE is located in Chittagong. Both exchanges have undergone automation and now utilize electronic trading systems. The Securities and Exchange Commission regulates both exchanges and defines the rules under which they operate. The document also discusses some challenges facing the exchanges, such as price manipulation and delays in settlements.

2.  A stock market plays as a strong role in the industrialization
and economic development of the country. Among the
developing countries, the contribution of the capital market
have lately been recognized.
 The capital market in Bangladesh is still at a
developing stage. Bangladesh capital market is one of
the smallest in Asia but the third largest in the south Asia
region. It has two automated stock exchanges namely
Dhaka stock exchange and Chittagong stock exchange.
 The Dhaka Stock Exchange (DSE) and Chittagong Stock
Exchange(CSE) has undergone significant changes
contributing towards the development of Bangladesh capital
market

3.  It is the regulatory body of Bangladesh
capital market. SSEECC RReegguullaattiinngg tthhee CCSSEE
aanndd DDSSEE
 SEC defines working process and rules
and policies under which the stock
exchanges will operate.

4. SEC RReegguullaattiinngg tthhee CCSSEE aanndd DDSSEE
4

5.  Dhaka Stock Exchange (Generally known as DSE) is the main
stock exchange of Bangladesh. It is located in Motijheel at
the heart of the Dhaka city.
 Dhaka Stock Exchange is the first & biggest stock exchange
of the country. The operation of Dhaka Stock Exchange
started on May 14, 1964 after renaming East Pakistan Stock
Exchange Limited.
 Dhaka Stock Exchange (DSE) is registered as a Public Limited
Company and its activities are regulated by its Articles of
Association rules & regulations and bye-laws along with the
Securities and Exchange Ordinance - 1969, Companies Act -
1994 & Securities & Exchange Commission Act - 1993.

6.  In the beginning DSE was a physical stock exchange and
used to trade in the open out-cry system. After that to secure
smooth, & effective operation on the market, DSE uses
automated trading system. The system was installed on 10th
August, 1998 and was upgraded time to time.
 There are 238 members and total 529 listed securities in
Dhaka Stock Exchange.
 Every stock market has its indices to show movements in the
market as a whole. In the beginning DSE had only one index.
However, now there are two different indices which are DSI
broad index and DSE 30.

7.  Chittagong Stock Exchange is the 2nd stock exchange of
Bangladesh. It is said that CSE is the pioneer of the modern capital
market of the country as it introduces modern technology &
sophisticated logistic support.
 It was incorporated as a self regulated non-profit organization on 1st
April, 1995 and formally opened on November 4, 1995. It started its
trading through cry-out system. Then Chittagong Stock Exchange
started first automated trading system of the country. CSE started its
automated trading on 2nd June, 1998 and internet trading service
on 30th May, 2004.
 CSE consists of 25 members of whom 12 are elected through
election of CSE members, 12 members are elected from different
major economic & social arena of Bangladesh and CEO is
nominated and appointed by its own board but the approval of SEC
mandatory.
 Now CSE has 147 members and 250 of listed securities

9. TThhee PPrriimmaarryy MMaarrkkeett
 The primary market deals with newly issued securities and is
responsible for generating new long-term capital.
TThhee sseeccoonnddaarryy
 The secondary market handles the trading of previously-issued
securities, and must remain highly liquid in nature
because most of the securities are sold by investors.

10. 10

11. There are four markets in the system -
PPuubblliicc MMaarrkkeett
Only trading of market lot share is done here through automatic
matching.
SSppoott MMaarrkkeett
Spot transactions are done here through automatic matching which
must be settled within 24 hours.
BBlloocckk MMaarrkkeett
A place where bulk quantities of shares are traded through pick and
fill basis.
OOdddd LLoott MMaarrkkeett
Odd lot scripts are traded here based on pick and fill basis.
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12. 600
500
400
300
200
100
0
2009 2010 2011 2012 2013
2009
2010
2011
2012
2013
2014
22000099 441155
22001100 444455
22001111 449900
22001122 551155
22001133 552299

13. PPOOLLIICCIIEESS OOFF DDSSEE
DSE can introduce automate monitoring systems that may
control price manipulation, malpractices and inside trading.
It can make sure all the listed companies publish their annual
reports with actual and proper information that can ensure
the interest of the investors.
To force the listed companies to declare and pay regular
dividends through conducting Annual General Meeting.
To make arrangement to set up merchant banks, investment
banks and floatation of more mutual funds particularly in the
private sectors.
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14. PPOOLLIICCIIEESS OOFF DDSSEE ((CCoonnttiinnuueedd))
More banks, insurance companies and other financial institutions
should be encouraged to deal in share business directly
The management of DSE should be vested with professionals
and should not in any way be linked with the ownership of
stock exchange and other firms.
To train the investors about fundamentals to deal in share
transactions.
To punish the member brokers for breaching of contract.
14

15. Listing of Companies
Providing the screen based automated trading
of listed Securities
Settlement of trading
Granting approval to the transaction
Market Administration & Control
Market Surveillance
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16. Publication of Monthly Review
Monitoring the activities of listed companies
Investor’s grievance Cell
Investors Protection Fund
Announcement of Price sensitive or other
information about listed companies through
online.
16

17.  Stock market crash is a sharp and unexpected
decline of stock market prices for a very short
period of time, usually accompanied with the
decline of many other assets’ prices. It causes
significant capital losses of investors and
speculators. The market participants become
panicked which leads to more losses.

18.  Stock Market Crash of 1987
 Stock market crash of 1996
 Stock market crash of 2010-11

20.  19thDecember was a historical day of the financial year 2010-
11 in Bangladesh stock market. On this day DSE witnessed its
biggest one day fall in 55 years history until the date with
losing 551.76 points or 6.71 percent
 In the mid December, to meet CRR & SLR requirements of BB
by the deadline created liquidity crisis in banking Sector and
call money rate made a new record of 180%. Investment
Corporation of Bangladesh (ICB), state-owned commercial
banks (SCBs), regulators and government brought some kind
of stability in the market after the big fall of 19thDecember &
liquidity crisis. As a result, share prices increased from 20th to
until 30th December and index stood at 8290 point at the end
of the financial year 2010-11

22.  On 9th January DSE General (DGEN) Index declined by 600
points and all indices declined nearly 7.75 percent. On
10thJanuary Dhaka Stock Exchange General (DGEN) Index
lost by 660 points or 9 percent & Chittagong Stock
Exchange Selective (CSE) Index declined by 914 points or 6.8
percent within 50 minutes of trading

23.  Role of market regulators and their employees
 Demutualization of Exchanges
 Uniform Face Value of Shares
 Trade in Pre-IPO Placement
 Misuse of Omnibus Accounts
 Faulty Asset Revaluation
 Irregularities in Book Building Method
 Lack of knowledge of small investor

24.  December Closing of Financial Institutions
 Serial and Artificial Trading
 Issue of Right and Preference Shares
 Suspicious Transaction of Top Players
 Block Placement
 Direct Listing

25. PPRROOBBLLEEMMSS AANNDD LLIIMMIITTAATTIIOONNSS OOFF DDSSEE
PPrriiccee MMaanniippuullaattiioonn
It has been observed that the share values of some profitable
companies have been increased fictitiously some times that
hampers the smooth operation of DSE.
DDeellaayyss ooff sseettttlleemmeenntt
Financing procedures and delivery of securities sometimes take
an unusual long time for which the money is blocked for
nothing.
IIrrrreegguullaarr ppaayymmeenntt ddiivviiddeennddss
Some companies do not hold Annual General Meeting and
eventually declare dividends that do not reflect the real or
actual financial positions of the company and ultimately
shareholders become confused.
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26. PPRROOBBLLEEMMSS AANNDD LLIIMMIITTAATTIIOONNSS ((ccoonnttiinnuueedd))
SSeelleeccttiioonn ooff mmeemmbbeerrsshhiipp
Some members being the directors of listed companies of DSE look
for their own interest using the internal information of share market.
IImmpprrooppeerr FFiinnaanncciiaall SSttaatteemmeenntt
Many companies of DSE do not focus real position of the company
as some audit firms involve in corruption while preparing financial
statements. As a result the shareholders as well as investors do not
have any idea about position of the company.
TTeecchhnniiccaall pprroobblleemmss aanndd ppoolliittiiccaall iinnffiigghhttiinngg
The concept of centralization of securities market has not been
implemented that arises technical problems and political infighting.
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27. PPRROOBBLLEEMMSS AANNDD LLIIMMIITTAATTIIOONNSS ((ccoonnttiinnuueedd))
LLaacckk ooff sskkiilllleedd mmaannppoowweerr
in DSE as well as financial and non financial institutions
involved in the securities market.
TThhee llaacckk ooff pprrooppeerr ppoolliiccyy
Absence on framework that provides incentives and
protection to investors.
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28.  To force the listed companies to publish their annual reports
with actual and proper information that can ensure the
interests of investors
 To introduce automated monitoring system that may control
price manipulation, malpractices and inside trading
 To introduce full computerized system for settlement of
transactions.
 To force the listed companies to declare and pay regular
dividends through conducting Annual General Meeting
 To take remedial action against the issues of fake certificates
 Banks, insurance companies and other financial institutions
should be encouraged deal in share business directly.
 To punish the member brokers for breaching of contract

29. THANK YOU