Press Release

CSE Awaiting SEC nod of Derivatives Trading Regulation
CSE President sought cooperation to popularize “Financial Derivatives”

Dhaka, December 13, 2007: CSE President Mr. Nasiruddin Ahmed Chowdhury has urged Journalists Community to popularize the Derivatives Products to the general invests. He said, “When the bourses will finally launch the product it is necessary for all to confirm about understanding of the Derivatives Product. Without knowing or much equipped with the derivative knowledge it is impossible to implement by the stock exchanges, he added while inaugurating the seminar organized by CSE for the local journalists’ community at Lavinci Hotel, Dhaka.
In his inauguration speech, he told that in the present scenario, introduction of such products would surely increase the confidence of the investors as well the cash market. In his speech he also hoped that this seminar, designed for the journalists community will help prepare the reporters as well the exchange for introducing derivative products.
He said, “Bangladesh Capital Market will have a new dimension in the near future when adding “Derivatives” with the existing equity products. But for this we may need to have some reforms in our existing policies and rule & regulations – and in a recent meeting, we have also received such commitment from the Securities and Exchange Commission (SEC). And, I am happy to inform you that, accordingly the Chittagong Stock Exchange has already submitted a draft “Regulatory and Operational Framework for Introducing Financial Derivatives” to SEC for their scrutiny and comments”.

Mr. Nasiruddin Ahmed Chowdhury, President of CSE is speaking as Chief Guest at a seminar on "Financial Derivatives" organized for the print and electronic media at Dhaka on 13th December, 2007 . From his left CSE Director Mr. Bijan Chakroborty, CSE CEO Mr. AB Siddique, immediate CSE past President Mr. MKM Mohiuddin, CSE Directors Mr. ASM Sahidullah, Dr. Majed Khan are also

He further said, these new financial instruments are an increasingly important vehicle for unbundling risks. These instruments enhance the ability to differentiate risk and allocate it to those investors most able and willing to take it. This unbundling risk improves the ability of the market to engender a set of product and asset prices far more calibrate to the value preferences of investors than is possible before derivative markets are developed. The product and asset price signals enable entrepreneurs to finely allocate real capital facilities to produce those goods and services most valued by investors, a process that has undoubtedly improved national productivity growth and standards of living.
He further said, “As we approach the twenty-first century, both Exchange and brokers will need to continually reassess whether the risk management practices have kept pace with their own evolving activities and with changes in financial market dynamics and readjust accordingly. Should they succeed I am quite confident that market participants will continue to increase their reliance on derivatives to unbundle risks and thereby enhance the process of wealth creation.”
Mr. Atiquzzaman, Head of Compliance of CSE has made presentation on the topic. In his presentation, he said derivatives are the must products for Risk Management while investing in the stock market, and when there is any derivative on a stock, it increases the liquidity of that stock in the cash market resulting in the overall liquidity in the market.

Mr. A. B. Siddique, Chief Executive Officer of the Exchange while speaking on the occasion said that this course is the outcome of our series of awareness seminars on familiarizing derivatives in our market. This seminar will put us one step forward towards introducing derivatives in our market. Our market is ready and it became the need of the time to standardize our market with international standards.

The derivative products, which do not exist at all in our stock market, are the most popular investment instruments for the corporate investors as well as for individuals in the developed countries in India, Pakistan etc. CSE officials Manager G Faruque, Deputy Manager Mr. AKM Shahroze Alam were also present at the seminar.