The Dhaka bourse on Thursday suspended trading of Grameen Mutual Fund One and Grameen Mutual Fund One (Scheme Two) units as per a directive of the Securities and Exchange Commission after the funds had declared a stock dividend for the year to June 30 without taking the regulator's permission.
Grameen1 on the day announced a 25 per cent cash dividend and a 50 per cent stock dividend while GrameenS2 a 10 per cent cash dividend and a 10 per cent stock dividend for the last fiscal year.
But, a SEC member said, 'A close-ended mutual fund cannot raise its capital by issuing a stock dividend as it is against the conceptual framework of such funds.'
It is why the capital market watchdog has ordered the suspension of trading of units of both the funds, besides taking the decision of sitting with the fund managers to learn the reasons for making such a unilateral action, he explained.
The commission is scheduled to hold the meeting with the parties concerned on September 4, sources said.
The funds in their postings on the website of Dhaka Stock Exchange, however, said the announcements of the decisions taken by their trustee committees to distribute cash and stock dividends were proposals that were subject to approval of the SEC.
Source : New Age
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