BSEC sets margin loan limit based on DSEX

Staff Correspondent | Published: 22:00, Sep 21,2020


The Bangladesh Securities and Exchange Commission on Monday set the maximum limit on margin loan facilities based on the movement of Dhaka Stock Exchange’s key index, DSEX.

The regulator issued a directive on the day in this regard with effect from October 1 this year.

According to the directive, merchant bankers and portfolio managers and brokerage houses at the DSE can provide margin loans to their clients based on the movement of DSEX.

If the DSEX falls below 4,000 points, the margin loan would be at the rate of 1:1, it said.

It means that the intermediaries can provide maximum Tk 1 in loan against Tk 1 of a client.

If the DSEX remains between 4,001 to 5,000 points, the clients of the intermediaries would get margin loan at the rate of 1:0.75.

If the index remains between 5,001 to 6,000 points, the intermediaries can give margin loans at 1:5 and for above 6,001 the rate would be 1: 0.25.

Currently the margin loan is set at 1:0.5.

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