Desk Report:
Bangladesh Bank has issued a separate circular—FEID Circular No. 04, dated 03/11/2026—regarding the issuance of preference shares by Bangladeshi companies to non-resident investors, their conversion into ordinary shares, redemption, and the repatriation of dividends.
The circular clarifies the obligations of the issuing companies, the investors, and the banks involved in these transactions.
According to the circular, Bangladeshi companies may issue preference shares to non-resident investors with a dividend rate of up to 5 percent. Such issuances do not require prior approval from Bangladesh Bank; however, the issuing company must submit a report to the Foreign Exchange Investment Department of Bangladesh Bank following the issuance. For preference shares with a dividend rate exceeding 5 percent, approval may be sought from Bangladesh Bank, provided that the rationale for the proposed rate is explained.
Furthermore, no prior approval from Bangladesh Bank is required for the repatriation of dividends earned by non-resident investors on these preference shares, nor for the redemption of the shares themselves. The circular also outlines the provisions for converting preference shares into ordinary shares, as well as the procedures for issuance and the submission of reports.
