Investment Corporation of Bangladesh Authorized for Private Placements of Securities free essay sample

CONTINUED OPERATION Private Placements ICB is authorized to act as an agent of the issuers and investors for private placements of securities. Under this arrangement, ICB places securities to individuals/institutions on behalf of the issuer for which it charges fees. ICB also acquires shares/securities for its own portfolio both in pre-IPO placement and equity investment. Custodian and Banker to the Issues To act as the custodian to the public issue of Open-end Closed-end Mutual Funds. ICB provides professional services. It also acts as the Banker to the issues and provides similar services through the network of its branches. Fees in this regard are negotiable. Mergers and Acquisitions Companies willing to expand their business through mergers or acquisitions or to Dis-investment projects that no longer viable into present capacity of operation can contact the Corporation. ICB provides professional services advices in respect of shaping up the cost and financial structures to ensure best possible operational results. We will write a custom essay sample on Investment Corporation of Bangladesh: Authorized for Private Placements of Securities or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Besides, in case of divestment, the corporation, through network and established business relationship, bring buyers and sellers together, help them to negotiate final agreement and advice on the emerging corporate structure. Corporate Financial Advice Government enterprises and Companies intending to go public issue often seek professional financial advice on corporate restructuring reengineering. ICB through its expertise provide such services through its expertise. Lease Financing ICB Provides lease finance mainly for procurement of industrial machinery, equipment and transport. ICB provides professional advice and financial assistance to the intending clients. The period of lease, rental, charges, and other terms and conditions are determined on the basis of type of assets and the extent of assistance required by the applicants. Since introduction of this scheme in 1999 good responses have been received from the intending lessees. Investment Portfolio of ICB Being the largest institutional investor ICB contributes significantly to the development of the countrys cap ital market through active portfolio management which is one of the important functions of ICB. During 2003-04 a total investment of Tk. 138. 93 crore has been made in the investment portfolio of ICB including Tk. O. 2 crore in shares of a company through Pre-IPO placement, Tk. 7. 0 crore in debentures of two companies, Tk. 0. 3 crore in preference shares of a company and Tk. 5. 0 crore in bonds of a company. Advance Against Unit Certificates Scheme Advance Against ICB Unit Certificates Scheme was introduced in 1998, especially designed for the ICB unit- holders to meet their emergency fund requirements. One can borrow maximum Tk. 5 per unit by despositing his/her unit certificates under lien arrangement from any of the ICB offices where from such unit certificates were issued. The rate of interest on the loan is reasonable and competitive. Advance Against Mutual Fund certificates Scheme Advance against ICB Mutual Fund certificates Scheme was introduced in 2003, designed for the ICB Mutual Fund Certificate-holders to meet their emergency fund requirement. One can borrow maximum of 50% value of last one years weighted average market price of certificates at the time of borrowing by depositing his/her certificates under lien arrangement from any of the ICB offices. The rate of interest on the loan is reasonable and also competitive. Consumer Credit Scheme As part of business diversification programme, ICB has introduced Consumers Credit Scheme in 2003-04 considering at the need of various household commodities of different employees of govt. , semi-govt. , autonomous bodies and some established private sector organizations. Under this scheme one can enjoy minimum Tk 1. 0 lac but maximum 5 lac credit facilities. The rate of interest on the loan is reasonable and competitive which is fixed by the board of directors of ICB considering the bank rate nd with the guidelines of Bangladesh Bank. Bank Guarantee scheme ICB introduced Bank Guarantee scheme in 2002-03. ICB provides (i) Bid Bond for enabling the business people to participate in any tender or bidding; (ii) Performance Bond for helping the business community to continue their business smoothly by fulfilling their obligations promised by them to their clients; and (iii) Customs Guarantee for solving different disagreements between the customs authority and the business classes at the initial stage. The maximum limit of guarantee is Tk. 2. 00 crore and would be issued against at east 20% cash and 80% easily encashable securities or against 100% cash margin. Re-guarantee from other financial institution is required for guarantee against the amount exceeding Tk. 2. 00 crore. Training Local Training During 2003-04, as part of human resource development programme, ICB endeavoured to develop the skill, knowledge and professional competence of its manpower by arranging various in-house and local training courses. During the year, 26 officers and 09 employees of ICB received local training on different subjects including Policy towards investment and industrialization, VAT and Taxation, Performance Measurement of Financial Institutions-a Credit Rating Perspective, Web page Design and Development,Venture Financing and Factoring, Investment and Merchant Banking, Managing core risks in banking for senior bcinkers, Corporate Governance, Institutional Computer Training, Trade Union Training Course for Organiser, Young Leadership, Development of small and medium enterprises etc.. Foreign Training During 2003-04, no officer/staff participated in any foreign training course. Trustee to the debenture and Securities assets ICB is acting as trustee to the debenture issues and asset-backed securitised bonds. ICB acted as trustee to the issues of 17 companies of which 7 companies has been redeemed successfully. Objectives | To encourage and broaden the base of investment. | | To develop the capital market. | | To provide for matters ancillary thereto. | | To mobilize savings. | To promote and establish subsidiaries for business development. | Business Policy | To act on commercial consideration with due regard to the interest of industry, commerce, depositors, investors and to the public in general. | | To provide financial assistance to projects subject to their economic and commercial viability. | | To arrange consortium of financial institutions including merchant banks to provide equity support to projects and thereby spread the risk of underwriting. | To d evelop and encourage entrepreneurs. | | To diversify investments. | | To induce small and medium savers for investment in securities. | | To create employment. | | To encourage Investment in IT sector. | | To encourage Investment in joint venture capital/project. | Basic Functions | Underwriting of initial public offering of shares and debentures| | Underwriting of right issue of shares| Direct purchase of shares and debentures including Pre-IPO placement and equity participation| | Providing lease finance to industrial machinery and other equipments singly or by forming syndicate| | Managing investors Accounts| | Managing Open End and Closed End Mutual Funds| | Operating on the Stock Exchanges| | Providing investment counsel to issuers and investors| | Participating in Government divestment Program| | Participating in and financing of, joint-venture projects| | Dealing in other matters related to capital market operations| | Trusty, Custodian, Bank Guarantee | | Consumer Cre dit |