Economic Affairs Adviser to Prime Minister Mashiur Rahman inaugurating Janata Bank's merchant banking operation Monday, Chairman Suhel Ahmed Chowdhury and CEO-cum-MD of the bank SM Aminur Rahman seen, among others.

Janata Bank Limited, the second largest state-owned commercial bank, Monday launched its merchant banking operation to support the development of the stock market.

Economic Affairs Adviser to the Prime Minister Dr Mashiur Rahman inaugurated the merchant banking unit of the bank in the city.

Speaking as chief guest at the inaugural function, Dr Rahman said, "Institutional investors can play a vital role to strengthen the capital market as they are its lifeline."

"The country's capital market has an immense potential to be developed, though it is small compared to the neighbouring countries," he added.

Urging all to work together for making the market vibrant and safe place for investment, Mashiur said, "All stakeholders should play due role to make the market buoyant and vibrant."

"A paltry amount of domestic savings is now being invested in the market. So, now it has a better chance to expand," he hoped.

Former chairman of the Securities and Exchange Commission (SEC) Faruq Ahmad Siddiqi, president of the Dhaka Stock Exchange (DSE) Rakibur Rahman, chairman of the bank's board of directors Suhel A Choudhury and managing director of the bank SM Aminur Rahman spoke at the launching ceremony.

Faruq Ahmad said, "In the last two years the stock market has seen overwhelming growth, as its market capitalisation increased to $15 billion from $5 billion."

"This is not the end, it's just the beginning," he said and hoped that the market will develop further in the near future.

He said there should always be a balance in supply and demand of securities to bring stability to the market. "Excess liquidity or shortage of it destabilises the market," he added.

Referring to the book building method, recently introduced by the securities regulator, he said the scientific price discovery method would encourage the big profit making corporate houses, as it ensures fair IPO price. "The big corporate houses, which were hesitant to get listed with the bourses, will feel encouraged to go public," he added.

Aminur Rahman said, "We have a plan to go public by 2009. Over the years, the quality of the bank's services has improved, the corporate culture has also changed considerably."

"The bank will be in a position to invest a sizeable amount in its own portfolio to contribute to the development of the stock market," he said.

Janata Bank was the first state-owned bank that received the full-fledged merchant banking licence from the Securities and Exchange Commission last month.

As of 2008, Janata Bank has an authorised capital of Tk 8.0 billion and paid up capital of over Tk. 2.60 billion.

Turned into a private limited company in late 2007, the bank has employed 13,379 people operating through 849 branches, including four overseas branches.