Trading of PLFSL shares suspended | 2019-07-16

Trading of PLFSL shares suspended

Staff Correspondent

16 July, 2019 12:00 AM printer

The authorities of Dhaka Stock Exchange (DSE) and Chattogram Stock Exchange (CSE) suspended the trading of People’s Leasing and Financial Services Limited (PLFSL) share from Sunday last.

The boards of both the bourses suspended the company’s share trading on Sunday as per the rules of stock exchanges. Earlier, the Bangladesh Bank gave the directive to both DSE and CSE to stop transaction of PLFSL share.

According to Section 50 (1), the regulator can postponed the share trading of any company if there is a shortage of important information that may violate the provisions of the rule of listing in regulation.

As per the rules, shares trading of the Company will remain suspended for 30 working days in the first phase. If the regulator requires the stock exchange next time can extend the validity period for another 15 working days.

The bench of Justice Muhammad Khurshid Alam Sarkar also ordered the Bangladesh Bank to freeze the accounts of those who were in PLFS’s board until 2015, Tanjib-ul Alam, a lawyer of the central bank told the daily sun.

Menahwile, Md Asaduzzaman Khan, deputy general manager of the BB’s financial institutions department, has been appointed as the liquidator.

“The High Court has ordered the liquidator to submit his report to the court,” Alam said.

Asked whether a deadline has been given for submission of the report, the lawyer said: “Liquidation is a complex process and this is the first ever case in the country. So, the court did not set any specific timeframe for the liquidator.” Sami Huda, managing director of PLFSL, told that he has heard about the court’s order to appoint a liquidator.

Earlier on June 27, the finance ministry instructed the central bank to shutter the NBFI for its failure to improve its conditions.

Previously, two banks -- Bank of Credit and Commerce International and Oriental -- were restructured but not liquidated.

Liquidation of PLFSL means closing its operations permanently and the BB with court’s permission will take actions to settle liabilities by selling off its assets.

The NBFI has failed to repay the depositors’ money despite maturity of the funds, found a BB investigating. Default loans and net losses have recently escalated as well.

The problems of PLFSL began in earnest in 2013-14, when some of its directors made off with more than Tk 1,000 crore by way of submitting fake documents, according to a central bank inspection report then.In 2015, the central bank had removed five directors for their involvement in the financial scandal.