The Financial Express

LR Global demand amending mutual fund rules

| Updated: May 09, 2021 11:10:52

LR Global demand amending mutual fund rules

The rules of mutual funds should be amended to ensure the sectors' expansion at a desired level and professionalism must be developed in the industry.

The chief executive officer (CEO) of the LR Global Asset Management Reaz Islam said this Saturday at a press briefing

"The fund managers have a lack of professionalism. The rules of the MF should also be amended to ensure the sectors' expansion at a desired level," said Mr. Islam while he laid importance on the accountability of the fund managers.

He said that it's the high time to restore investors' confidence in the MFs.

The president of American Chamber of Commerce in Bangladesh Syed Ershad Ahmed was the chief guest at the programme and inaugurated the event online.

Terming the 'misinformation' a big problem of the capital market, Islam said investors must have an interest in going through the disclosures of the MFs.

"The country's capital market should be better than that of India. We want to accelerate our cooperation with the securities regulator, media, and other stakeholders for the sake of the market and MF industry," Mr. Islam said.

He has also said the LR Global is the 'number one' fund manager in terms of return per unit of risk over the last five years.

In his reply to a question, Islam said the expansion of the tenures of the closed-end MFs was not a wise decision despite they also availed the same scope.

The previous commission extended the tenures of the listed closed-end MFs for another period of ten years amid wide criticisms made by experts.

Recently, a New York-based investment firm having stake in LR Global sent a letter to the securities regulator expressing concern over the LR's fund management.

While his attention was drawn in this regard, the CEO of LR Global Mr. Islam said that claim was 'fake' and someone else wanted to take its advantage.

In his reply to another question regarding the withdrawal of LR Global's investment from a new agency, Islam said they would follow the instruction of the securities regulator.

In his speech, the LR Global's CEO Mr. Islam said serving the interest of several quarters at least or two commissioners of the previous commission conspired against their resounding success.

"The coordinated attack remained until late 2020."

Asked, whether the previous commission took measures against the LR Global without finding any violation of rules and regulations, Islam said the most of the complaints lodged against them were just conceptual.

Terming the incumbent commission the best one, Islam said the regulator has developed an overall transparent and investment friendly market.

He has applauded many steps, including imposing penalties on the large wrong doers, mandating a dividend distribution policy, easing IPO (initial public offering) approval process, taken by the securities regulator.

In a presentation, the CEO of LR Global Mr. Islam upheld the performances of their MFs using different standards globally used for evaluating a fund manager's performance.

He said the LR Global managed funds have consistently raked on top over last five-year period in terms of annualised and cumulative method.

"LG Global managed funds have reported 51.8 per cent cumulative returns for last five years while the benchmark of the cumulative return is 30.80 per cent," Mr. Islam said.

He has also said some other five fund managers observed cumulative returns ranging between 4.2 per cent and 59.4 per cent.

"Annualised returs of our funds was 8.7 per cent while the funds managed by other five fund managers were ranging between 0.8 per cent and 9.8 per cent."

According to Islam, their funds ranked number one over the last four-year period in case of reporting annualised returns.

The size of the MFs managed by the LR Global is Tk 10.60 billion as on Thursday.

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