BASIC TERMS AND CONCEPTS OF

INVESTMENT BANKING
&
PROBLEMS AND PROSPECTS OF CAPITAL
MARKETS IN BANGLADESH

Syed Maruful Islam

51840061
  that helps individuals or organizations raise capital and provide
financial consultancy services to them

 They act as intermediaries between security issuers and investors and

help new firms to go public

Investment
 They either buy all the available shares at a price estimated by their
Banking experts and resell them to public or sell shares on behalf of the issuer
and take commission on each share.
 Any financial institution / intermediary which can carry out the activities
connected with issue management is registered with SEBI and follow its
Issue manager regulations and guidelines is capable of venturing into issue management.
Issue management is an important activity for merchant bankers.
underwriter
Underwriters are responsible for deciding whether or not to accept applications for insurance cover – this
is known as ‘risk’.

Determining risk is a complex process and the job relies on sensible judgement and meticulous attention
to detail

The underwriter must ensure that accurate quotes are produced that are competitive to the customer, yet
profitable for the company. Underwriters may work in many areas but the work generally falls into the
categories of life assurance, commercial insurance, general insurance and reinsurance.
Primary market
The primary market is where securities are created. It's in this market that firms sell (float) new stocks
and bonds to the public for the first time
An initial public offering, or IPO, is an example of a primary market.
These trades provide an opportunity for investors to buy securities from the bank that did the initial
underwriting for a particular stock.
secondary market
The secondary market is where investors buy and sell securities they already own

It is what most people typically think of as the "stock market," though stocks are also sold on the primary
market when they are first issued

. The national exchanges, such as the New York Stock Exchange (NYSE) and the NASDAQ, are
secondary markets.
Problems and Prospects of Capital Markets in
Bangladesh
Why capital Market is important ?
◦ The capital market is the engine of growth for an economy
◦ performs a critical role in acting as an intermediary between savers and companies seeking additional
financing for business expansion.
◦ performs a critical role in acting as an intermediary between savers and companies seeking additional
financing for business expansion.
 Why our  Access to high quality and credible corporate information remains a

stock market
major problem in the market.

 the absence of independent research houses, retail investors primarily

is under focus on advice given by their brokers, which often consists of market
rumors

developed?  Filtering of information among different types of investors may leave

scope for manipulation; this assumption had been proved right in the
1996 market meltdown at the cost of many individuals and households.
The Recent Surge in the stock Market
Stock market index jumped by over 100 points in 5th January 2021 within two hours of the day's trading.
With the surge, the index touched one and a half years' high points.
Problems in the Stock market
Liquidity Crisis
Aggressive Profit Taking in Selective Stock
Aggressive Profit Taking in Selective Stock
Lack of Knowledge & Confidence among Small Investor
Rumors, Speculation and Manipulation
Weak Corporate Governance
Weak Corporate Governance
Major Future Prospects of Capital
Market
The Telecom Giants in Bangladesh are finalizing their offers for IPO in the market.
A deep-sea port requiring 1 billion dollars is going to start with a policy decision that it will also be listed.
Power and energy sectors demand for capital is 5 to 10 billion dollars within short time to meet the
immediate needs of 5000 MW power demand.
A deep-sea port requiring 1 billion dollars is going to start with a policy decision that it will also be listed.
A deep-sea port requiring 1 billion dollars is going to start with a policy decision that it will also be listed.
Textile sector as backward linkage to thriving export-oriented garments industries is booming.
Export oriented food processing industry needs huge capital and technical capacity to meet the growing
standards in global market for marine food, fruits and poultry.
IT sector with our talented developers, yet to demonstrate the massive potentials of software industry of
the country
THANK YOU