Investment Corporation of Bangladesh (ICB)

The Investment Corporation of Bangladesh (ICB) was established on 1 October 1976, under “The Investment Corporation of Bangladesh Ordinance, 1976” (no. XL of 1976).The establishment of ICB was a major step in a series of measures undertaken by the Government to accelerate the pace of industrialization and to develop a well-organized and vibrant capital market particularly securities market in Bangladesh.

ICB is a statutory corporation. It is mainly an investment bank. (As an investment bank is a financial institution, which mobilized fund from the surplus economic units by savings securities and developed funds to the deficit economic unit also by buying/underwriting securities.)

OBJECTIVES OF ICB:

To encourage and broaden the base of investment. To develop the capital market. To provide for matters ancillary thereto. To mobilize savings. To promote and establish subsidiary companies for business expansion.

BASIC FUNCTIONS OF ICB:

Direct purchase of shares and debentures including Pre-IPO placement and equity participation.

Providing lease finance to industrial machinery and other equipments singly or by forming syndicate.

Underwriting of initial public offering of shares and debentures. Underwriting of right issue of shares. Managing investors’ Accounts. Managing Open End and Closed End Mutual Funds. Operating on the Stock Exchanges. Providing investment counsel to issuers and investors. Participating in Government divestment Program. Participating in and financing of, joint-venture projects. Introducing new business products suiting market demand. Providing Consumer Credit. Providing Bank Guarantee. ØTo act as Trusty and Custodian. Dealing in other matters related to capital market operations.

FINANCIAL RESULTS: 

Total Income:In 2009-10 ICB earned a total income of Tk.527.62 crore as compared to Tk.364.21 crore earned in 2008-09 showing an increase by 44.87 per cent. The major heads of income of ICB were interest income, capital gain, dividend income and income from fees and commissions. During. Of the total income of Tk.527.62 crore, the highest income being the capital gain of Tk.262.9 crore (49.83 %). Divided income increased due to satisfactory dividend performance of maximum companies.

 Total expenditure:During 2009-10, the total expenditure amounted to Tk. 314.57 crore as compared to Tk. 252.58 crore in 2008-09 showing a decrease of 24.54% over the previous year. The major heads of expenditure were: interest expense of Tk. 157.71. During the year, provision of Tk.2.02 crore was provided against loans and advances. In addition, Tk.100.0 crore has been set aside against future diminution in the value of marketable securities held in the own portfolio, possible fluctuation of stock market indices and present booming market condition.

Gross Profit:The gross profit before provision and tax was Tk.340.07 crore in 2009-10 compared to Tk. 170.04 crore in 2008-09, showing an increase of 99.99% over last year.

Net profit:During 2009-10, ICB’s net profit after tax increased to Tk. 213.05 crore from Tk. 111.63 crore in 2008-09, showing an increase of 90.85 percent.

Dividend:The Board of directors of ICB recommended cash dividend as the rate of Tk. 15.00 per share and 1:4 stock dividend for 2009-2010. Cash dividend of Tk. 5.00 per share and 1:1 stock dividends were paid in the previous year.

 Appropriation of Profit:The Board of Directors of ICB recommended appropriation of Tk. 222.25 crore which includes net profit of Tk. 213.05 crore of 2009-10 and retained profit of Tk. 9.2 crore of the previous year and others in the manner:

Figure: Appropriation of profit of 2009-10 (crore)