The stock market regulator has barred listed companies, where sponsors and directors do not hold at least 30 percent shares of the paid-up capital, from raising funds in any forms, including rights or bonus shares and company amalgamation.
The Bangladesh Securities and Exchange Commission (BSEC) said in a statement that the decision came at a meeting on Tuesday (May 21) presided over by its Chairman M Khairul Hossain.
The decision came after it was found that 47 companies lacked compliance with the minimum shareholding requirement by their sponsors and directors.
The sponsor and director of these companies have violated a 2011 directive by the regulator, which was imposed after the 2010 market crash.
The move was aimed to make the directors responsible and loyal to small investors, as it was seen that many directors sold off their shares right before the debacle.
The BSEC has also decided that shares of the companies failing to comply with the directive would be traded in a separate category in the bourses and directors and sponsor would not be allowed to sell or transfer or mortgage the shares.
If a director of a listed company fails to hold at least 2% share of paid-up capital vacancy should be completed within 30 working days, according to the statement by the market regulator.
The BSEC has also decided to slap restrictions on announcing bonus shares. From now on, the expansion, balancing, acquisition, reconstruction and expansion of the company and bonus shares will not be declared without quality improvement.