Written by The Banking Post
The Bangladesh Securities and Exchange Commission (BSEC) has flagged two brokerage firms—Monarch Holdings and Columbia Shares and Securities—for severe net worth shortfalls and directed the Dhaka Stock Exchange (DSE) to take regulatory action.
Trading at Monarch Holdings is already suspended, while Columbia Securities continues to operate despite its capital deficit.
BSEC spokesperson Md Abul Kalam confirmed the directive, saying: “BSEC identified problems with Columbia Shares and Securities Ltd. and Monarch Holdings Ltd., and we have instructed the DSE to take action. This is part of our routine monitoring to detect financial weaknesses in brokerage firms.”
Regulatory shortfall
Under securities rules, brokerage firms must maintain a net worth of at least 75 per cent of their paid-up capital. Falling short signals financial instability and can lead to suspension or licence cancellation.
New brokerage firms are required to hold a minimum paid-up capital of Tk 50 million, while joint ventures need Tk 80 million and foreign firms Tk 100 million to operate in Bangladesh.
Earlier this month, the BSEC reviewed eight brokerage firms after a DSE request. Among them, Monarch and Columbia were found with the most severe equity-related weaknesses. Other firms under review included Fariha Securities, Assurant Securities & Management, WingsFin, Matrix Securities, Mir Securities, and Tasia Securities. Tasia’s operations have remained suspended since December last year due to its own capital shortfall.
Monarch under scrutiny
Monarch Holdings, founded by Abul Khayer Hiru, has long been mired in controversy. Former national cricket star Shakib Al Hasan was also once a shareholder. Currently, Kazi Sadia Hasan, Hiru’s wife, serves as managing director.
Hiru and associates have faced multiple share manipulation cases, with fines amounting to billions of taka already imposed by the BSEC.
Despite repeated attempts, officials of Monarch Holdings and Columbia Securities could not be reached for comment.
Past crackdowns
The securities regulator has previously taken stern action against errant brokerages. In May this year, Shah Mohammad Sagir & Co lost its TREC licence for embezzling Tk 137 million of clients’ funds.
Market analysts note that several brokerage failures in the past left small investors unable to recover their money, prompting regulators to tighten oversight. They say the latest enforcement moves signal a stronger push to safeguard market stability and investor confidence.
