Who are Foreign Investors?
- Any foreigners residing in Bangladesh or abroad willing to invest in Bangladesh Capital Markets are considered Foreign Investors.
- Bangladesh provides a very friendly and open investment atmosphere for foreign investors.
- No Capital Gains Tax on individuals.
- A long-established legislative and legal framework protects foreign investment in Bangladesh.
How to start
- Open a NITA Account with an AD (Authorized Dealer) of the foreign currency department of any financial institution, or through a custodian.
- Select a Custodian in Bangladesh (HSBC, Standard Chartered, Dhaka Bank, Southeast Bank, AB Bank, or Citi NA).
- Open a BO account through the custodian.
- Open a Trading Account with your preferred broker (optional — the custodian can provide the service through the cash account/NITA on behalf of the investor).
- Start trading.
What is a NITA Account?
- The Non-resident Investment Taka Account (NITA) is an account for channeling foreign currency in, as well as repatriation of earnings from investment.
- All earnings from investments (e.g. cash dividends) are credited to the NITA account.
- An audited statement certifying that all proper taxes are withheld from earnings (usually handled by the custodian) is used for fund repatriation.
Common services provided by local Custodians
Account servicesTrade settlement servicesRegistration servicesSafe-keeping servicesCorporate Action servicesForeign Exchange servicesCash management servicesMarket expertiseEscrow services
Trading (Custodian ↔ Broker)
- The custodian usually receives orders via SWIFT or another acceptable standard and carries out share and monetary transactions with the local broker.
- DVP (Delivery versus Payment): delivers shares from the FI's BO to the broker's BO upon receiving payment — applicable for sale orders.
- RVP (Receive versus Payment): receives shares to the FI's BO and makes payment — applicable for buy orders.
What is a BO account?
- BO stands for Beneficiary Owners account. It holds shares purchased or credited due to corporate declarations.
Requirements — Individuals
- • Attested photographs
- • Bank statements
- • Copy of pay slip or tax return (optional, as part of KYC)
- • Copy of employment certificate or trade license
- • Copy of passport
- • Nominee photographs and details
- • Other relevant forms
Requirements — Institutional
- • Memorandum & Articles of Association
- • Certificate of incorporation
- • Board resolution permitting investment/trade in Bangladesh
- • Custodian details
- • Board resolution naming authorized persons with identification and specimen signatures
Tax Rates
- No Capital Gains Tax on individuals (subject to the condition that the assessee is entitled to a similar exemption in their country of residence).
- Income tax is 25% for individuals.
- 25% tax at source is deducted by the issuer on cash dividends.
Custodian Banks in Bangladesh
Full contact details are available in the DSE foreign investor guide.
- HSBC
- Standard Chartered Bank
- Dhaka Bank
- Southeast Bank
- AB Bank (Arab Bangladesh Bank)
- BRAC Bank
- Citi N.A.
- Agrani Bank
Source: Dhaka Stock Exchange — Foreign Investor Guide.