Staff Reporter :
Under newly amended regulations, stockbrokers and dealers are now permitted to retain up to 75 percent of the interest earned from clients’ funds held in the Consolidated Customer Account (CCA), according to the latest changes to the Securities and Exchange Rules, 2020.
Published in a government gazette on 3 July, the amendment introduces a framework that aims to balance operational flexibility for brokers with improved investor protection and transparency.
As per the revised rules, brokers must deposit the remaining 25 percent of interest income into the Investors’ Protection Fund maintained by their respective stock exchanges. These deposits are to be made every six months, within 30 days of the close of each period.
In addition, brokers are required to submit detailed reports of the deposits – along with interest calculations and supporting documentation – to the relevant stock exchange and notify the Bangladesh Securities and Exchange Commission (BSEC) within 10 days of completing the transaction.
Previously, brokers were obliged to distribute the entire amount of interest earned on client funds directly to investors. However, due to operational challenges in calculating and disbursing interest accurately, brokers had long petitioned for the right to retain a portion of the income.
Until 2021, stockbrokers were allowed to keep the full amount of interest from CCAs without sharing it with clients. This practice was later curtailed to enhance accountability and align with global investor protection standards.
The latest amendment is seen as a compromise that ensures a portion of the earnings benefits investors through protection funds, while also addressing the practical concerns raised by brokers regarding fund management.
Market observers note that the rule change is part of broader efforts by the BSEC to foster a more transparent and investor-friendly capital market.
