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IFC Seeks $4b Bond to Issue in Local Market

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International Finance Corporation (IFC) seeks to issue taka-denominated bonds worth $4 billion, among local investors to lend the proceeds to projects in Bangladesh.

IFC has already issued local currency bonds among domestic investors in the Philippines and India, where the funds were lent to priority sectors.

Prior, the IFC successfully issued a three-year Tk 80 crore taka-denominated bond, coined “Bangla Bond”, at London Stock Exchange.

Its iconic bell ringing ceremony was held in November 2019 and the proceeds were used to support food safety with an agribusiness client in Bangladesh.

The Bourses analysts welcome the move, saying it would inspire local stock investors to make new investments in the bond market.

The World Bank Group member sent a letter to the Ministry of Finance last year requesting approvals required under its “Articles of Agreement”.

In response, the ministry sent a dsiclosure to the Bangladesh Securities and Exchange Commission (BSEC) asking whether the stock market regulator has any objection.

The BSEC replied it had none. “Hence, the IFC will have to apply and take approval to issue bonds from the BSEC following the securities rules and regulations,” it added.

The IFC is keen to expand its financing in taka for clients in Bangladesh who do not generate USD as a part of their daily operations, the IFC said in its letter.

The bonds will help support the growing financing needs of various priority sectors, including agriculture, manufacturing, those related to climate change, microfinance and lenders focusing on small and medium enterprises and women-owned enterprises.

It will also support the government’s efforts to develop and grow the domestic capital market in Bangladesh.

BSEC Chairman Prof Shibli Rubayat-Ul-Islam agreed that the bond would give new impetus to the development of the country’s bond market.

The BSEC is trying to make the bond market vibrant as the market can give a good source of funds to entrepreneurs, he said.

It has already made treasury bills and bonds tradable on the stock exchanges with the help of Bangladesh Bank and the National Board of Revenue.

There are about 270 treasury bonds worth more than Tk 2.5 lakh crore and with tenures ranging from two years to 20 years, showed data from Bangladesh Bank.

Of them, 222 were listed on Dhaka Stock Exchange (DSE) as of August, with a combined value of Tk 59,359 crore.

But they were not traded like shares and mutual fund units, which require availing a beneficiary owner’s account first.

Rather they could be bought and sold straight over the counter, much like savings certificates.

“The IFC wants to issue bonds worth $4 billion and the IFC is not alone. Asian Development Bank (ADB) also wants to issue bonds in the Bangladesh stock market. It would be better for our stock market,” added Islam.

 

 

 

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Weekly U.S. Stock Market Reports Diverse Performance

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Reviewing the U.S. Stock Markets, the Nasdaq Composite, recorded a decent hike of 555 points, reaching a closing value of 17,688 points by the end of the week. Similarly, the S&P 500 index showed a positive trend, gaining 85 point to settle at 5,431 points. Meanwhile, DJIA Index experienced a notable drop, losing 209 points during the week and concluding at 38,589 points after a week of gaining.

In contrast, Russell 3000 Index saw a gain in week performance, with a slight hike of 40 points to reach 3,077 points by the end of the week.

Moving to Russell 2000 Index, demonstrated a notable drop of 20 point, ending the week at 2,006 points.

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Weekly European Stocks Shows Negative Result

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In the Outgoing week, the European stock market displayed a massive losing performance.

Here is the data on the weekly performance of the European Stock Market, The STOXX Europe 600 index, which is considered a leading benchmark for the European market and covers approximately 90 percent of the market capitalization across 17 countries, reported a drop of 12.5 points to close at 511.05.

The United Kingdom’s FTSE 100, one of the most widely followed indices in Europe, also showed a significant drop, losing 99 points or finishing the session at 8,146.

In Germany, the DAX 30 index, lost by 555 points to reach 18,002, while France’s CAC 498 decreased by 9 points to stop at 7,503 at the end of the trading day.

Italy’s FTSE MIB, which covers the top 40 stocks traded on the Milan Stock Exchange, decreased by 1,995 points to 32,665. However, Spain’s IBEX 35, added by 412 points, to close at 10,992.

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South Asian Stocks Reports Gaining Performance in Recent Week

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A review of South Asian stock markets shows that India’s Bombay Stock Exchange (BSE) index BSE Sensex has added 299 points during the week. At the end of the week, the index stood at 76,992 points. On the other hand, the Nifty-50 index of the country’s National Stock Exchange gained by 175 points last week. At the end of the week, the index stood at 23,465 points.

Pakistan Stock Exchange Index ‘KSE 100’, shed 2,926 points last week. After a week of losing, the index settled at 76,742 points.

On the other hand, The Sri Lankan stock market index adds, and the Colombo Stock Exchange index ‘ASPI’ increased by 208 points in a week. After a week the index settled at 12,314 points.

Bhutan’s stock market index ‘BSI’ added 68 points hence the index stood at 1,515 points throughout the whole week. Nepal’s ‘NEPSE’ gain 35 points, therefore the index stands at 2,112 points.

Hence Dhaka Stock Exchange: The benchmark index ‘DSEX’ dropped by 119.51 points or 2.28 percent, in the outgoing week. At the end of the week, the index stands at 5,117 points.

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