Bangladesh Securities and Exchange Commission

Jiban Bima Tower (15th, 16th, 17th and 21st Floor), 10 Dilkusha B/A, Dhaka-1000, Bangladesh.

Ref No- SECMRRCD/2009-193/181

Date: 8 December 2015

Directive

Directive on Provisioning for Unrealized Losses in Own and Client Portfolios of Stock Brokers, Stock Dealers, and Merchant Bankers

(1) Stock Broker/Stock Dealer:

Under the authority granted in Section 20A of the Securities and Exchange Ordinance, 1969, the Commission provides the following benefits to stock brokers/stock dealers regarding the provisioning for unrealized losses:

• a) Stock dealers are provided the optional benefit of provisioning for unrealized losses arising from revaluation of shares held in Dealer Accounts as of December 31, 2015 (or according to the applicable financial year) in five equal quarterly installments (20%) from December 2015 to December 2016 (or according to the applicable financial year); and

• b) Stock brokers are provided the optional benefit of provisioning for unrealized losses arising from revaluation of shares pledged via margin loans currently provided to clients as of December 31, 2015 (or according to the applicable financial year) in five equal quarterly installments (20%) from December 2015 to December 2016 (or according to the applicable financial year).

However, these benefits are applicable only to the provisioning for revaluation losses (unrealized) arising in the year ended December 31, 2015 (or according to the applicable financial year). Valuation losses for the year 2015 are also included herein. Subsequent provisioning (if any) must be maintained at par. It is noted that as a result of availing the above opportunities, no cash dividend shall be paid for the said financial year.

(2) Merchant Banker:

Under the authority granted in Section 20A of the Securities and Exchange Ordinance, 1969, the Commission provides the following benefits to merchant bankers regarding the provisioning for unrealized losses:

• a) Merchant bankers (where applicable) are provided the optional benefit of provisioning for unrealized losses arising from revaluation of shares held in their Own Portfolios as of December 31, 2015 (or according to the applicable financial year) in five equal quarterly installments (20%) from December 2015 to December 2016 (or according to the applicable financial year); and

• b) Merchant bankers are provided the optional benefit of provisioning for unrealized losses arising from revaluation of shares pledged via margin loans currently provided to clients as of December 31, 2015 (or according to the applicable financial year) in five equal quarterly installments (20%) from December 2015 to December 2016 (or according to the applicable financial year).

However, these benefits are applicable only to the provisioning for revaluation losses (unrealized) arising in the year ended December 31, 2015 (or according to the applicable financial year). Valuation losses for the year 2015 are also included herein. Subsequent provisioning (if any) must be maintained at par. It is noted that as a result of availing the above opportunities, no cash dividend shall be paid for the said financial year.

For the Order of the Bangladesh Securities and Exchange Commission

Professor Dr. M. Khairul Hossain

Chairman.

---

Phone (PABX): +880-2-3056505-2, +880-2-3056240, Fax: +880-2-3056925, E-mail: secbd@bdmail.net, Web: www.secbd.org, www.sec.gov.bd

---