Capital market's trillion-dollar potential hinges on honest leadership: Stakeholders

Bangladesh’s capital market, despite its size and potential, has yet to fulfill its promise as a driver of industrialisation and economic growth. 

Speakers at a roundtable discussion on Saturday, October 4, said weak regulatory leadership, governance failures, and years of irregularities have eroded investor confidence and stunted long-term growth.

The event — “Investment in the Capital Market: Potential and Challenges” — was organised by Jagonews24.com and chaired by its Editor KM Ziaul Haque at the outlet’s conference hall. Participants included leading economists, capital market experts, and Dhaka Stock Exchange (DSE) directors.

Among the speakers were Md Moniruzzaman, Managing Director and CEO of Prime Bank Securities Limited; Md Al-Amin, member of the Capital Market Reform Task Force; Md Shakil Rizvi, former president and current director of DSE; Minhaj Mannan Emon, director of DSE; Mahmud Hossain, chartered accountant; and Md Mamunur Rashid, market analyst. 

The session was moderated by Jago News Deputy Chief Correspondent Sayeed Shipon.

Governance and leadership at the core of the crisis

Task Force member Md Al-Amin said the country’s capital market has long suffered from neglect and poor leadership.

“Institutional investors behave like retail traders, while the state has remained indifferent to capital market development,” he said. “Many bureaucratic heads of state-owned institutions avoid taking responsibility, often pursuing personal benefit instead.”

He emphasised that restoring stability will require a robust governance framework:

“The core issue is governance failure — from auditors and valuation firms to independent directors. Unless we ensure qualified, experienced directors and a transparent ‘fit and proper’ system, investor trust will not return.”

Al Amin also identified negative equity and margin loan misuse as the “cancer” of the market, citing politically connected large investors who receive illegal margin facilities.

“Ordinary investors pay the price. We’ve recommended setting minimum qualifications for margin loans and tightening oversight,” he said.

On IPOs, he warned that “nameless, loss-making companies” were being listed by manipulating financial statements.

“Some of these firms aren’t even eligible for bank loans. They raise money, disappear, and leave investors stranded,” he said, urging the BSEC to impose stricter accountability for auditors and valuation agencies.

Restoring investor confidence

DSE Director Md Shakil Rizvi said investor trust hinges on transparency and proper information flow.

“AGMs have become scripted and controlled. Investors are denied real dialogue with company owners. We need fair, agenda-based AGMs held at neutral venues,” he said.

He added that many company websites remain outdated and fail to provide timely data, making research difficult for small investors.

“Without credible audit reports, the market cannot regain confidence. The goal is not inflated share prices — it’s genuine growth in sales, production, and profits,” he said.

Rizvi also noted that assets worth around Tk 1 lakh crore were wiped out due to the collapse of leasing firms and weak banks, calling it “a serious blow to investor morale.”

Disconnect from the real economy

DSE Director Minhaz Mannan Emon delivered an impassioned critique of regulatory inertia.

“We have at least 500 companies ready for listing, but they stay away due to harassment and uncertainty,” he said. “You’ve built every mechanism to suppress the righteous and reward the corrupt.”

Emon said the capital market has become disconnected from the country’s economic pulse.

“Why doesn’t the market rise when the economy performs well? Because it’s not aligned with the real economy. The commission must include people who understand that the capital market is the lifeline of industrialisation,” he said.

He warned that without honest leadership, the market’s trillion-dollar potential within a decade would remain “just a fantasy.”

Banking sector credibility erodes confidence

Prime Bank Securities CEO Md Moniruzzaman said the banking sector’s credibility crisis has dragged down the capital market.

“Around 2010, banks were among the strongest pillars of the market. Today, some are reporting massive quarterly losses after years of fake profitability,” he said.

He pointed out that while some banks now report Tk 1,000-crore losses per quarter, those with strong governance have maintained investor trust.

“Investors must look at NPL ratios, governance records, and risk indicators before investing,” Moniruzzaman advised.

He also criticised mutual fund mismanagement, calling it “one of the worst governance failures in recent memory.”

“Some fund managers embezzled investor money and parked it in non-listed companies. Trustees and custodians failed to act,” he said. “The result — a huge gap between NAV and market price, and deep distrust among investors.”

‘Moral decay and political settlement behind looting’

Chartered accountant Mahmud Hossain delivered a blunt assessment: “The core of our capital market’s problems lies in moral decay, state weakness, and planned looting,” he said.

He alleged that “capital looting” had occurred through politically sanctioned deals and opaque financial instruments such as Sukuk bonds and the Stabilization Fund.

“Investable money has been siphoned out with no accountability. Not a single meaningful investigation has been completed,” he said.

Hossain argued that no reform would be sustainable without transparency, accountability, and justice:

“Thousands of crores have been laundered, yet the corrupt remain untouchable. We must restore ethics and strengthen institutions to rebuild trust.”

Investor confidence at a low point

Investor and analyst Md Mamunur Rashid said that in the past 14 months, the portfolios of many investors have halved in value.

“Those who invested Tk 100 a year ago are now left with Tk 50,” he said.

He called for quicker disclosure of institutional and foreign investor shareholdings and more clarity in dividend policies.

“Companies making profits must distribute fair dividends. Only then can investors see real value,” he added.

The way forward

Speakers at the discussion agreed that while the market is mired in crisis, its potential remains immense. With the right leadership, good governance, and integration with the real economy, Bangladesh’s capital market could become a trillion-dollar contributor to the nation’s growth trajectory within a decade.

As DSE’s Minhaz Mannan Emon put it: “If we can break free from corruption, restore ethics, and align the market with the country’s economic ambition — the capital market can finally become the engine of Bangladesh’s industrial transformation.”

The roundtable also saw participation from Jago News Planning Editor Moniruzzaman Ujjal, Deputy Editor Dr Harun Rashid, Chief Correspondent Ibrahim Hossain Ovi, News Editor Mahbub Alam Rony, and other senior staff.