From Hope to Hurt: Can Bangladesh’s Stock Market Recover after 2025?
Syed Ishtiaque Reza [Published: Daily-sun, 06 January 2026]
For Bangladesh’s capital market, 2025 will be remembered not as a year of collapse, but as a year of slow suffocation. It began with promise and ended in pain. Investors entered the year with cautious optimism, encouraged by political change and repeated assurances of reform, transparency, and accountability.
What followed instead was a prolonged period of uncertainty, erosion of confidence, and steady withdrawal of participation. By the time the year drew to a close, the market had lost not only value but also faith.
At the start of 2025, the government signalled a break from the past. After years of manipulation, weak governance, and regulatory inconsistency, investors hoped the market would finally move toward stability.
Expectations were high that reforms would restore discipline, attract quality companies, and protect small investors. But as months passed, optimism gave way to frustration. The reform narrative remained largely rhetorical, while the market continued to drift without direction or conviction.
The benchmark index, DSEX, reflected this uncertainty throughout the year. From a position above 5,200 points at the beginning of 2025, the index slipped below the psychologically important 5,000-point mark following announcements on bank mergers and the liquidation of non-bank financial institutions.
Rather than reassuring investors, these decisions triggered panic. The introduction of new margin loan rules intensified selling pressure, leading to forced sales and accelerating the market’s downward momentum. Volatility became the defining feature of the year, with no sustained recovery in sight.
The deepest wound came from the financial sector. The merger of five banks and the liquidation process of eight out of nine non-bank financial institutions resulted in an estimated loss of Tk 5,500 crore for investors at face value. This loss was not merely financial; it shattered confidence.
For many retail investors, financial stocks had long been perceived as relatively safe. The events of 2025 dismantled that belief and reinforced fears that policy decisions could wipe out investments overnight.
One of the most alarming features of the year was the complete absence of initial public offerings. For the first time in the country’s capital market history, an entire year passed without a single IPO. The last listing had taken place in June 2024, and despite clear directives from the highest level of government, no quality public or private company entered the market in 2025.
This IPO drought significantly reduced market depth, limited investment options, and signaled a lack of confidence from potential issuers themselves. A market without new listings inevitably becomes stagnant, and 2025 proved exactly that.
As returns diminished and uncertainty grew, investors voted with their feet. According to data from the Central Depository Bangladesh Limited, more than 66,000 BO accounts became completely empty during the year.
Compared to December 2024, the total number of BO accounts fell by nearly 43,000, bringing the figure down to around 1.64 million. This decline cut across all investor categories, reflecting a broad-based loss of confidence rather than isolated dissatisfaction.
Even among accounts that remain active on paper, actual participation is weak. Around 367,000 BO accounts now hold zero shares, indicating that many investors have exited the market in practice while keeping their accounts technically open.
Market participants estimate that the number of truly active investors may be no more than 400,000 to 500,000. For a country of Bangladesh’s size and ambition, this level of engagement is alarmingly low.
Throughout 2025, reform was frequently discussed but rarely felt. Regulatory efforts remained confined to a handful of rules and guidelines, including new margin loan and mutual fund regulations. These measures, instead of restoring confidence, often created further confusion.
Legal challenges against the margin rules and the decision to wind up term-based mutual funds added to market uncertainty. The much-talked-about capital market reform task force failed to deliver any meaningful outcomes, while coordination between regulators and market participants remained weak.
The leadership of the securities regulator also came under intense criticism. Across the market ecosystem, dissatisfaction with the commission’s credibility and effectiveness was widespread. The post-political-change expectation of swift and structural reform faded quickly, replaced by the perception of indecision and disconnect. Analysts argue that 2025 did not witness a dramatic crash precisely because confidence had already been drained gradually. It was a year in which trust quietly bled away.
As the new year begins, expectations are cautious rather than hopeful. The market appears trapped in a vicious cycle: low confidence leads to low participation, which suppresses liquidity and returns, further deepening mistrust.
Investors are now looking toward an elected government to take ownership of the capital market agenda. What they seek is not short-term stimulus, but predictable policies, credible regulation, quality listings, and protection from sudden, value-destroying decisions.
Whether 2026 will bring recovery remains uncertain. But one lesson from 2025 is clear: without trust, no market can thrive. Restoring that trust will require more than promises; it will demand consistent action, transparency, and the political will to put investors first.
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The writer is a journalist and columnist