The seminar titled "Regional Seminar on Capital Market Development: Asian Experiences" will begin on September 27, when most of the regional stock market regulators, operators and major stakeholders will brainstorm on preventing any recurrence of the Asian financial crisis.

International Chamber of Commerce-Bangladesh (ICC-B) is organising the seminar. ICC-B President Mahbubur Rahman announced the schedule at a press conference in Dhaka yesterday.

Chiefs of Securities and Exchange Board of India, Securities and Exchange Commission (SEC) of Pakistan, SEC of Sri Lanka and SEC of Bangladesh have already confirmed their participation at the seminar, Rahman said.

Senior executives of Karachi, Bombay, Nepal, Thailand, Tokyo, Malaysia, Korea, Singapore, Dhaka and Chittagong stock exchanges are also expected to attend the gathering, he said.

He said the seminar will provide a forum for sharing regional experiences and bouncing ideas, and contribute significantly in working out strategies for long-term development of the capital market.

The ICC-B president said in the wake of the Asian crisis, all the affected countries in Asia had opened themselves up to uncontrolled inflows of short-term funds and allowed foreign borrowing through a raft of reform programmes.

"But crisis is not an essential condition for the successful introduction of economic reforms. Indeed, gradual reform is best accomplished in a more tranquil atmosphere with profound institutional changes," the ICC-B chief said.

He said the capital market of Bangladesh clocked an impressive growth during the '90s in terms of increased market capitalisation and index. The Securities and Exchange Commission (SEC) was set up in Bangladesh in 1993 to regulate the development of the market and to enhance the degree of investors' protection.

The capital market was dormant in the '70s and early '80s. At that time, very few companies raised funds from the capital market and investors were not interested in or familiar with corporate securities.

"After the general elections in June 1996, the market witnessed the biggest ever boom. Large numbers of investors entered the capital market with new listings made one after another and speculative trading gripped the market. Trading volume rose sharply and DSE All Share Price Index reached an all-time high of 3648 points. Price earning soared and shares were traded at 80 times the face value," Rahman continued.

He said in November 1996 the inevitable happened and the market crashed. In a span of just 20 months, the index plunged to 650 points when it was passing through a process of consolidation. Fundamentals and rationalities replaced speculations and rumours. Regulations became more comprehensive. As the market matured, investors became increasingly cautious about their investments and weighed the risks and returns.

The ICC-B president said Bangladesh's capital market now is very attractive in terms of value indicators, which calls for cultivating and developing the capital market to provide long-term industrial financing. But following the 1996 boom and burst, investors remained shy and many still prefer not to actively participate in stocks trading.

Keeping these in mind, ICC-Bangladesh has organised the seminar to revitalise the market and draw a roadmap for a long-term sustainable development of regional markets.

ICC-B Vice-president and Chairman of Transcom Group Latifur Rahman, ICC-B Vice-president and Chairman of Square Group Samson H Chowdhury, Thai-Bangladesh Chamber of Commerce and Industry President Rashed Maksud Khan and former president of Dhaka Chamber of Commerce and Industry ASM Kashem were also present at the function.

Replying to a query about listed companies' unwillingness to hold annual general meeting (AGM), Samson H Chowdhury said it is necessary to make the companies aware of their responsibilities.

He said companies sometimes face dilemma when it is found that the laws and regulations of SEC and the Company Act seem contradictory.