Insurance companies intending to raise funds from the stock market will have to invest at least 20 per cent of their equity in securities listed in Bangladesh.

The requirement was made public through a notification published by the Bangladesh Securities and Exchange Commission (BSEC) on January 5.

This will bring in some fresh funds, said a stock market analyst.

It is normal for insurers to invest their funds in the market but this minimum condition will enhance their participation, he said.

The notification exempted insurers from a clause of the public issue rules which states that a company cannot raise funds of less than Tk 30 crore from the stock market through fixed price method.

The 26 non-listed insurance companies are allowed to raise funds of a minimum of Tk 15 crore, according to the notification.

The 18 life and remaining eight non-life insurance companies are exempted from some of the clauses of the public issue rules, it read.

As the finance minister directed all the insurance companies to offload shares, they are trying to come over, said a top BSEC official.

Finance Minister AHM Mustafa Kamal in September 2019 gave the order for all insurers to get listed with the stock market within three months. He warned that their licences would be cancelled otherwise.

Crystal Insurance and Express Insurance then complied with the directive.

In tune with requests by the remaining companies, the BSEC decided to exempt them from the clause so that every issuer comes over to the market, said the official.

The minimum 20 per cent equity investment requirement will give a boost to the country's capital market, he added.

Sheikh Kabir Hossain, president of Bangladesh Insurance Association, said some insurance companies have already got listed while others were trying.

"It is usual for some to take a bit of time to get listed," he said.