No progress in talks on NAV calculation

As yesterday's meeting on implementation of net asset value calculation for share credit ended inconclusive, the stockmarket regulator will sit again with merchant bankers next Sunday.

The Securities and Exchange Commission says the method should come into effect within the stipulated time, while merchant bankers argued the NAV- based computing is not possible under the existing market system."The commission still stands firm on implementing its decision on NAV-based calculation for credit disbursement as well as loan maintenance," Anwarul Kabir Bhuiyan, executive director of Securities and Exchange Commission, told reporters after the meeting.

He said, "The commission asked the merchant bankers to come up with figures on how much loans they provided to their clients, and we'll sit with them next Sunday with the facts and figures."

According to meeting sources, many attendees agreed to the point that NAV-based calculation is a complex one.

Representatives from Dhaka and Chittagong stock exchanges were also present in the meeting.

Opposing its implementation, the merchant bankers urged the regulator even to cut the credit ratio further from the existing 1:1.

The SEC on August 24 instructed the merchant bankers and stockbrokers to follow such method from October 1.

As per the NAV-based margin, a merchant bank or a stockbroker can provide loan on the basis of value of a stock, as determined by adding the market value to NAV and dividing the sum by two.

However, speculating a positive outcome from yesterday's meeting, Dhaka stocks closed higher with the benchmark DSE General Index increasing more than 16 points, or 0.25 percent to 6,670.