The commission also halted the transaction of around 11 lakh shares worth around Tk 30 crore of Jamuna Bank held by 30 shareholders including nine sponsor directors. These shares would not be transferred without further instruction from the SEC.

The directive followed an enquiry into the unusual rise in share prices of Jamuna Bank throughout the month of April.

SEC Executive Director Mansur Alam said that based on some unusual trading of the bank's shares in April this year, the commission had queried whether there was any undisclosed price sensitive information. In reply, the bank said there was no such information.

But on April 27, he said, the bank declared 1.5 percent cash dividends and 25 percent stock dividends for its shareholders. "Then the commission formed a two-member enquiry committee suspecting that some of the shareholders of the bank might be aware of such information before disclosure," he added.

The enquiry found that 30 shareholders of the bank were involved in insider trading.

The committee also found that the issue managers and the issuer company and its management including sponsors, directors and officers concerned furnished the commission with certain incorrect information as well as concealed important and relevant material information from the commission at the time when the initial public offering (IPO) of Jamuna Bank was being considered.

“The above activities of the said shareholders concerned appeared to be a contravention of the laws pertinent to securities, affecting the discipline of the capital market and the interest of the investors at large,” the SEC directive said.

The directive also said that the commission in public interest, deemed it proper and appropriate to issue directive to the issuer company including its board of directors and officers concerned for maintaining status quo in the respective portfolios of the said persons.

Mansur Alam also said that some brokerage houses were also involved in the insider trading. Actions will be taken against them as per the law, he said.

The commission will also take legal measures against the issue managers of the bank, as they were responsible for recommending the bank to the SEC for approval.

The issue managers of the bank are Investment Corporation of Bangladesh and the AAA Consultants Ltd.