An Analysis of the Functions of a Brokerage House:  A Case Study on United Enterprises & Co. Ltd.
Capital Market of Bangladesh is now a day more regulated and organized in comparison to the near past. The regulatory body especially SEC (Securities & Exchange Commission) always provides guideline to develop the capital market. Moreover, Investors’ confidence and involvement is increasing very rapidly in the market. Beside this, a good number of institutions have started Merchant Banking operation to serve the investors. These institutions are committed to earn profit for and on behalf of the investors and on the other hand they are making revenue and creating employment of a good number of people. If the investors’ hard earn money is not invested with a great care, the investor may loose their money and they must show their backs to the market. By applying prudent investment decisions the portfolio managers can make money for their clients, which may induce more involvement of the new investors in the market.

My study focuses on influence investment decision of capital market service in Bangladesh. It is also my concern that, from a very risky and volatile market like DSE whether the portfolio managers are contributing towards making money for and on behalf of the investors or it is simply the market trend to earn above average and sometimes abnormal returns from an investment.

In this study various factors have been identified that might influence the investment decision of individual investors in DSE. In line with our literature review, those entire factors are categorized into four categories, fundamental factors, technical factors, herd syndrome, and others. Fundamental factors include Earning per Share (EPS), expected dividends, Price/Earning ration (P/E), Return on Investment (ROI), and government policy affecting the firm. Technical factors include personal saving of the investors, growth of the industry, goodwill of the company, political situation, economy of the country, and profit taking. Company news, analyst’s report, sentiment, press recommendation, follow others remonstration effect are the herd syndromes. Price hike, rumors, lucky guess.

In early December, 2010 last when general index reached the record 8700 points, many analysts expressed their concern about the overvaluation and syndicated price hike. But that time our general investors were over-inspired by the gain from the market. It was seen that most regulatory decisions failed to slow down the unending market rally. Investing people became more dependent on rumors than fundamentals of the issues traded on the bourses. Now it is becoming clear to us that there are many other factors that have brought the capital market on the verge of a collapse.

In 2010, institutional investors especially some banks and non-bank financial institutions showed their investment characteristics like general investors. Over last two years, the profit of the banks and financial institutions became two to three times more than that of the previous years. This profit growth was attributed to profit earned from investment in shares. Thus many banks and financial institutions concentrated in share business instead of investing in their core banking activities. These financial institutions got enough time to reconstruct their investment. But now it is clear that financial institutions were busy at utilizing the deadline effect. In turn, many people are now blaming central bank for this. Lastly we found huge sale pressure in December by these institutional investors and this affected the market.

The development of capital market has been receiving heightened attention from the policy-makers in recent years. One explanation lies in the fundamental shift of development strategy reflected in the nearly universal embrace of the private sector as an engine of economic growth. The governments in both developed and developing countries, the international financial institutions which exert tremendous influence on intelligentsia have all joined together as ardent advocates of private entrepreneurship. Capital market can play an important role in accelerating economic development through efficient intermediation of savings into productive investments and in fostering the growth of private entrepreneurship.

United Group is one of the faster business conglomerates in Bangladesh & started its journey from 1976. The company strengthened its presence in the country’s growing stock market with launching a subsidiary United Enterprises & Co. Ltd. (UECL) in 2010- which is offering full-fledged brokerage service for retail and institutional clients.

UECL offers full-fledged, international standard capital market services for retail and institutional clients. UECL began its operation in June 2010 as member no. 207 of Dhaka Stock Exchange Ltd.

 History of United Group

1978 – This was the year when it all began. A group of friends, having decided to go into business together, acquired a small company for a meager sum, forming a partnership based institution. They worked as contractors for the Trading Corporation of Bangladesh and, in late 1979, registered the firm as a limited liability company. Thus, the United Group, as we know it today, was born.

One can only describe the journey since then till the present to have been a pioneering one, with strong international exposure from the very beginning. In the early 80s, thr group earned the initial capital as facilitators of barter with Bulgaria and Czechoslovakia. That is how we started generating surplus capital for investment purposes. During the same period, deals were struck with various international companies by the Group to act as the formers’ marketing representatives in Bangladesh, which enabled them to foray into the imports market. However, this was something that was not continued in the long run. Other ventures that were tried during the same period but not continued includes forays into the ready made garments manufacturing segment, the marine business especially in regards to dry cargo carrying, etc. among others.

During the late 80s, the Group acquired oil tankers for the transport of furnace oil and molasses between Chittagong and Khulna. In the case of the latter, the scenario was almost monopolistic, as we were responsible for almost all inland waterway transport for molasses being exported out of the country. During that same period, we also got engaged with several government projects for the Water Development Board (WDB) for river training and coastal embankment protection of rivers that were vulnerable to erosion. We made extensive use of geotextiles, a revolutionary material that has an excellent capacity for soil retention, thereby becoming the first company to introduce this technology in Bangladesh. As a result, we were quite successful in our venture and examples of our work are still evident today.
Since the early 90s, we decided to branch out into several new directions. We delved into the market for quality real estate projects, still in its early years during that time, under multiple banners. As a result the Group went on to develop some excellent projects over the years in the premium areas of Dhaka, including Gulshan and Baridhara. Then in 1992, we acquired Summit United Tank Terminals Ltd. from foreign owners. This would simultaneously make us the first private sector firm in the country to operate such terminals as well as making us one of the few companies in the country to acquire foreign owned establishments. The latter is something which we replicated later with our next acquisition being the Van Omeron Tank Terminals Ltd during the latter half of the 90s. In the case of both the terminals, efficiency could be argued to be among the finest in the world with absolutely zero handling loss throughout their operational years. Furthermore, within the space three or four years, massive work was done in regards to capacity building, something that had not been done for over 20 years in either unit. As a result, VOTT capacity was increased by 100% while SUTT saw an increase by over 300%. For strategic developmental reasons, both the business units were later sold and significantly high premium rates. Apart from that, by 1996 the Group entered the yarn manufacturing market, investing in Comilla Spinning Mills Ltd. which, to date, is one of the finest producer of mixed yarns in the market.

In 1997, we became the first independent power company in Bangladesh, being one of the partners that set up the Khulna Power Company Ltd. This would actually establish the ground work on which we would continue to invest in the power sector, having set up several small power plants for the REB since then. Our experience in this sector eventually led to the formation of United Power Generation & Distribution Co. Ltd., a truly pioneering company of its kind. In fact, United Group is probably the only local organization in the country to have complete know-how and expertise build and operate small to medium size power projects on its own with no outside support. Because of this, we are constantly looking for more ventures in this segment of the market.

Since 2000, United has seen a number of new doors open up to further possibilities in the commercial world. 2004 alone saw the formation of United Hospital Ltd, United Rotospin Ltd., Novo Healthcare & Pharma Ltd. and United International University. Other firms include Electronic Transactions Network Ltd., Hafez Zamiruddin Fisheries Ltd. and United Polymers Ltd., of which the latter is still operational, acting as a supplier of high quality PET bottles to the pharmaceuticals industry. United Land Port Teknaf Ltd. was another pioneering venture for the Group, through which a state of the art land port was set up between the border of Bangladesh and Myanmar. In essence, almost all trade between the nation is handled by this highly efficient port, which is currently undergoing a major expansion. With the final addition of Neptune Land Development Ltd in 2005, the company had enough opportunities to pursue well into the next decade, having solidly entrenched itself into some of the most profitable yet technologically advanced sectors in the country.

With each passing year United Group strives to go from strength to strength, achieving new milestones on the way. With the second generation of entrepreneurs being mentored by those who came before them, we can safely say that this decades old organization will, with the blessings of the Almighty, move into the future years with renewed strength, vigor, dedication and passion


NOVO Healthcare & Pharma Ltd.
United Hospital Ltd.
United Power Generation & Distribution Co. Ltd.
Comilla Spinning Mills Ltd.
United International University
Neptune Land Development Ltd.
United Property Solutions Ltd.
Hafez Zamiruddin Fisheries Ltd.
United Makkah Madina Travel & Assistance Co. Ltd.
United Polymers Ltd.
United Land Port Teknaf Ltd.
Khulna Power Company Limited
United Group Brokerage House

United Enterprises & Co. Ltd. (Stock Trading Division) is a division of the United Group, it is a corporate member of Dhaka Stock Exchange Ltd. and Central Depository participant. United Enterprises & Co. Ltd. started his commercial operation on 1st June 2010. On the basis of regulatory requirement The United Group going to form a subsidiary company for the operation of Untied Enterprises & Co. Ltd., with authorized capital Tk. 100000000.00 (Ten Crore) and paid up capital of Tk. 25000000 (2.5 Crore). The brokerage has only one branch at Gulshan in Dhaka.

The business and all other day to day administration affairs of the company shall be managed by the Chairman or by the CEO or by other Director under the supervision & control of Board of Directors.

Share Capital  

The nominal capital of the Company is Tk. 100,000,000/- (Ten Crore) divided in 1,000,000 (Ten Lac) shares of the Tk. 100/- each of classifications.

Table : 01 : Share capital of United Group
The current share holding position is shown under:

SL. No Name of Share Holders Nos. of shares taken by each Subscriber Signatures of Subscribers
1. Hasan Mahmood Raja 300 Sd/-
2. Khondaker Moinul Ahsan 200 Sd/-
3. Ahmed Ismail Hossain 200 Sd/-
4. Akhter Mohmood Rana 300 Sd/-

Source: Memorandum of Article of UECL
Figure : 01 : Organgram  of United Enterprises & Co. Ltd.
Source: United Enterprises & Co. Ltd. booklet.
 United Enterprises & Co. Ltd. main office client account
         opening process

  1. Client account opening is one stop service. Equity operation executive shall help the clients to complete the application forms.
    • Client account opening information file contain following forms:
  • Customer account information form.
  • Term and conditions forms.
  • Nominee form
  • Application for Credit Facility under Margin Rule 1999
  • BO Account opening form
  • BO Account Nomination Form
  • Power of Attorney (POA) Form
  • Signature Card
    • Executive collect the cash/cheques of account opening charges and initial investments (if any) issue a money receipt to the client.
    • Deposit the cash/cheques to accounts department authorized personnel by having a signature of the receivable of cash/cheque in the Money receipt counterpart in this segment of the account opening process.
    • After received application form executive verify the application duly filled up or not and necessary documents as mention bellow attached with form, if everything find according as required, executive sign on the form and verify it from head of equity sales by putting an unique client account number generated from back office software of client register.
Documents Resident account holder :
  • BO Account opening fee of Tk. 1000/- and initial Deposit of Tk. 10,000/-
  • Bank Statement certificate by the Branch Manager/Authorized officer.
  • Three copies of passport size photograph for individual and three copies for Joint Holder, (total six copies for individual & Joint Account)
  • Two copies of passport size photograph for nominee (attested by the A/C holder)
  • Photocopies of Passport/Nationality Certificate
  • Photocopy of National ID Card.
For NRB (Non-Resident Bangladesh)
  • BO Account opening fee of Tk. 1000/- and initial Deposit of Tk. 10,000/-
  • Bank Statement certified by the Branch Manager/Authorized officer.
  • Attested photocopy of passport.
  • Three copies of passport size photograph for individual and three copies for joint holder (total six copies for individual & joint account)
  • Photocopy of Work permit.
For Corporate
  • BO account opening fee of Tk. 1000/-
  • Bank Statement certified by the Branch Manager/Authorized officer
  • Three copies passport size attested photograph for every signatory.
  • Board Resolution.
  • Memorandum and Articles of Association.
  • Executive send it to CDS officers to open BO account and CDS officer sign in BO account opening form after opening BO account and put the number in specific field and attached BO account setup report with the file, CDS officer take step put other necessary entry of POA, Nominee mentioned in the form and upload Signature of Client, POA, Nominee etc in the CDS system. Reference number of BO account is the client account number.
  • After all the above task done the form send to the Head of Brokerage House for his approvable.
  • Executive shall make necessary data entry of the approved account and inform the client through sending letter/telephone/fax/SMS.
  • Finally the forms keep sequentially in special strong vault for record keeping under equity operation department.
  UECL branch office client accounts opening process
  • The branch will subsequently send all the collected application forms to the Branch Control officer for processing after keep sign of Branch in-charge attached copy of money receipt and bank deposit slip.
  • As soon as received the applications by equity operation Branch control officer will reconcile it with the accounts department officer. Keeping the original application in main office, send a duplicate copy to the branch for record keeping compliance purpose.
  Order processing, execution and settlement of trades

Order submission by client :

  • Clients may submit their orders through placing signed order forms either physically to head office or branch of UECL broker house.
  • Clients may also submit their orders through telephone.
  • The clients willing to use telephone and/or email sign the blank order and pay-in forms  and filled up the order form mentioning name, client code, date, time, securities name, quantity, rate etc. and collect signature within 24 hours of trade executed.
 Verification of Order
Trading staffs will verify the orders and execution the trade. Verifications shall be made in the following areas:
  • Money is available in client’s account for execution buy orders.
  • Securities are available and saleable for execution sale orders.
  • In case of corporate client, whether the order involves shares of the client company [clients will not be allowed to deal with own shares as it will violate the law of the jurisdiction]
  • Whether the client orders the share of a company in which he/she is a sponsor/director [UECL shall not execute trades of the client, who is a Director of a listed company, unless he/she completes the trading related regulatory formalities before placing the order]
  • Trading staffs shall also verify the telephone and e-mail orders.
  • The trading staffs shall fill the pre-signed order-forms for the telephone and email orders.
  • After receiving the orders (physical/telephone), the customer support desks of the branch or head office will forward the same to trading department for execution.
  • The chief trader, trading officers shall be the authorized signatories for operating the client’s accounts and accordingly endorse the orders jointly by any two.
  Execution of Trades
  • The trading department after verifying the order shall execute the trades.
  • The primary responsibility of the trading stuffs shall be to ensure timely and efficient execution of the trades.
  • Trading staff may also submit orders over telephone for emergency purpose or expediting the transactions, but the duly signed order forms shall be collected within the 24 hours of trade execution.
  • The trading staff shall download and process the trade data from exchange module in the back office system.
  • The trading staff shall take print out of the confirmation notes and collect signature from the clients at the close of trading hour every day or keep the same for delivery to the client.
  • The trading staff shall send the report along with the confirmation notes to the settlement department for settling the trades.
  • The Head of equity sales shall prepare a transaction summary for the day and submit the report to the head of the unit. The trade report shall contain detailed executed trades (quantity, average price, client, pending trades if any, etc)
  • While executing the trades, the trading staff shall not make any discrimination between the clients.

 Compliance guidelines

A member of the Dhaka stock exchange limited (DSE), the United Enterprises & Co. Ltd. is required to comply with the rules and regulations of Securities & Exchange Commission. These rules are subject to continuous amendments and should be updated according to the new changes. Highlights of these rules and regulations applicable at this moment are summarized below.

 Brief Description of DSE
The Necessity Of Establishing A Stock Exchange In The Then East Pakistan Was First Decided By The Government When, Early In 1952.It Was Learnt That The Calcutta Stock Exchange Had Prohibited The Transactions In Pakistani Shares And Securities. The Provincial Industrial Advisory Council Soon Thereafter Set Up An Organizing Committee For The Formation Of A Stock Exchange In East Pakistan. A Decisive Step Was Taken The Second Meeting Of The Organizing Committee Held On The 13th March ,1953. In The Cabinet Room, Eden Building ,Under The Chairmanship Of Mr. A . Khaleeli, Secretary Government Of East Bengal , Commerce, Labor And Industries Department At Which Various Aspects Of The Issue Were Discussed In Detail. The Then Central Governments Proposal Regarding The Karachi Stock Exchange Opening A Branch At Dhaka. , Did Not Find Favour With The Meeting Who Felt That East Pakistan Should Have An Independent Stock Exchange . It Was Suggested That Dhaka Narayanganj Chamber Of Commerce & Industry Should Approach Its Members For Parchase Of Membership Cards At RS.2000 Each For The Proposed Stock Exchange. The Location Of The Exchange It Was Thought Should Be Either Dhaka Narayanganj Or Chittagong . An Organizing Committee Was Appointed Consisting Of Leading Commercial And Industrial Personalities Of The Province With Mr. Mehdi Ispahani As The Convener In Order To Organize The Exchange.
The Chamber Informed Its Members And Members Of Its Affiliated Associations Of The Proceedings Of The Above Meeting ,Requesting Them To Intimate Whether They Were Interested In Joining The Proposed Stock Exchange. This Was Followed By A Meeting , At The Chamber Of About 100 Persons Interested In The Formation Of The Exchange On 07.07.1953. The Meeting Invited 8 Gentleman To Become Promoters Of The Exchange With Mr. M Mehdi Ispahani As The Convener And Authorized Them To Draw Up The Memorandum And Article Of Association Of The Exchange And Proceed To Obtain Register Under The Companies Act.1913. The Other 7 Promoters Of The Exchange Were Mr. J M Addision-Scott, Mr. Mhodammed Hanif, Mr. A C Jain, Mr. A K Khan , Mr M Shabbir Ahmed And Mr. Sakhawat Hossin.
It Was Also Decided That Membership Fee Was To Be Rs.2000 And Subscription Rate At 15 Per Month. The Exchange Was To Consist Of Not More Than 150 Members. A Meeting Of The Promoters Was Held At The Chamber On 03.09.1953 When It Was Decided To Appoint Orr Dignam & Co., Solicitors To Draw Up The Memorandum And Articles Of Association Of The Stock Exchange Based On The Rules Of Stock Exchange Existing In Other Countries And Taking Into Account Local Conditions.
The 8 Promoters Incorporated The Formation As The East Pakistan Stock Exchange Association Ltd. On 28.04.1954. As Public Company.On 23.06.1962 The Name Aws Revised To East Pakistan Stock Exchange Ltd. Again On 14.05.1964 The Name Of East Pakistan Stock Exchange Limited Was Changed To “Dhaka Stock Exchange Ltd.”
At The Time Of Incorporation The Authorized Capital Of The Exchange Was Rs. 300000 Divided Into 150 Shares. Of Rs. 2000 each and by an extra ordinary general meeting adopted at the extra ordinary general meeting held on 22.02.1964 the authorised capital of the exchange was increased to Tk. 500000 divided into 250 shares of Tk. 2000 each. The paid up capital of the exchange now stoods at Tk.460000 dividend into 230 shares of Tk. 2000 each. However 35 shares out of 230 shares were issued at TK. 80,00,000 only per share of TK. 2000 with a premium of TK. 79,98,000 .
Although incorporated in 1954, the formal trading was started in 1956 at Narayanganj after obtaining the certificates of commencement of business. But in 1958 it was shifted to Dhaka and started functioning at the Narayangonj chamber building in Motijheel C/A.
On 1.10.1957 the stock exchange purchase a land measuring 8.75 Kattah at 9F Motijheel C/A from the Government and shifted the stock Exchange to its own location in 1959.
Legal Control
The Dhaka Stock Exchange (DSE) is registered as a Public Limited Company and its activities are regulated by its Articles of Association rules & regulations and bye-laws along with the Securities and Exchange Ordinance, 1969, Companies Act 1994 & Securities & Exchange Commission Act, 1993.

Function of DSE
The major functions are:
– Listing of Companies.(As per Listing Regulations).
– Providing the screen based automated trading of listed Securities.
– Settlement of trading.(As per Settlement of Transaction Regulations)
– Gifting of share / granting approval to the transaction/transfer of share outside the trading system of the exchange (As per Listing Regulations 42)
– Market Administration & Control.
– Market Surveillance.
– Publication of Monthly Review.
– Monitoring the activities of listed companies. (As per Listing Regulations).
– Investors grievance Cell (Disposal of complaint bye laws 1997).
– Investors Protection Fund (As per investor protection fund Regulations 1999)
– Announcement of Price sensitive or other information about listed companies through         online.
Securities Traded at Bangladesh Capital Market
At present four types of securities are in the capital market of Bangladesh.
Figure : 02 Types of Securities in the capital market of Bangladesh

Source : DES Review
Administrative Framework of Capital Market of Bangladesh

Figure : 03 Capital Market Framework

Source : DSE Review

Capital Market Structure

Capital Market Structure
Source : DSE Review


                                    LITERATURE REVIEW
A market participant working as the agent of customers (investors) in exchange of commission is called broker. That is broker is the agent of the customers, maintaining the account of the customer, carrying out the order of the customer.

Primary & Secondary Market

Primary Market: The financial market that deals with the new securities is called primary market.
The functions of primary market –

  • Helping the companies to raise their capital.
  • Facilitating the issuance new securities.

Secondary Market: The financial market that deals with the existing (already issued) securities is called secondary market.
The functions of Secondary market-

  • Providing liquidity to the financial asset.
  • Price discovery ( Providing necessary information to the market participants in the authentic form)
Table: 02 : Division wise common factor of brokerage house
Functional Unit Working Review
Head of Brokerage
  • Prepare overall business plan.
  • Ensure achieving ultimate goal, objectives and strategies set by the higher management.
  • Finding business ideas and opportunities
  • Organizing a team for successful operation
  • Oversee Proper conduct of business by all the unit
  • Ensure proper safety and security of the assets of the unit
  • Allotment and supervision of works of each functional unit.
  • Adopting and ensuring the adherence of ethical code of conduct in all functional units.
  • Developing control function checklist
  • Adopting and ensuring appropriate internal control
  • Accord approval of all stock exchanges/clients payments.
  • Accord approval in the account opening form
  • Setting targets for each units and ensure achievement accordingly
  • Maximization of profit by increasing income and economizing expenses
  • To ensure proper capacity building of the unit
  • Marketing for enhance trade volume
  • Maintenance liaison with Head Office and other offices, local administration and public sector/private sector enterprises.
  • Maintaining liaison with regulatory body SEC, Stock Exchanges, CDBL, press and other market participants.
Equity Sales & Operation
  • Monitor trading of shares using Trading Work Station (TWS).
  • Monitor the others trading activities.
  • Contact with customer to buy or sell the securities.
  • Marketing to enhance trade volume.
  • Fix the trading limit of each TWS & customers.
  • Allow IPO shares for trading in the TWS.
  • Collect updated shares and financial position of the customers before execution of trade.
  • Monitoring the Spot traded share receive and delivery.
  • Download the trading file from TWS into back office database.
  • Solve the customer’s claim against trade.
  • Monitor & evaluate employees’ activities of the marketing & trading department.
  • Monitor the customer service activities.
  • Liaison with the customers.
  • Coordinate with other department of the house.
  • Verify the reconciliation of the pay in, pay out, shares to & from Stock Exchanges, shares received from customers, shares delivered to customer etc.
  • Verify the CDBL settlement reports according the back office daily.
  • Provide customers’ and total share position both physical and demat to Head of the Unit daily
Trade Execution
  • Participate in trading of shares using TWS.
  • Collect sell/buy orders slip and pay in slips from the customers.
  • Collect confirmation note of trade for & from the customers.
  • Filing properly the sale, buy order slips, confirmation notes etc.
  • Deliver the pay in slips to depository operation dept. with signature.
Customer Service, Registration
  • Receive Customer account opening form along with opening fee and verify the attached documents properly.
  • Take approval from authorized person for opening Customer and BO Account.
  • Open Customer Account and allot a code.
  • Scanning the customer signature card and input into the back office software.
  • Deliver the customer account opening fee to accounts department.
  • Filing the Account opening forms properly.
  • Receive phone calls or any complaints from customer.
  • Receive cheque requisition slip from customer & verify the signatures.
  • Inform the customers – Record Dates, AGM dates and benefits regularly of the listed companies.
Depository Operation
  • Setup all pay in and pay outs.
  • Append signature of all acknowledgements and reports.
  • Collect and filing pay in forms properly.
  • Do the payout setup before or on record date.
  • Check the incoming shares from stock exchanges, link account, IPO, corporate actions etc through CDS and download into the back office and inform the trading department.
  • Provide statement of total shares position to the equity and sales operation dept. daily.
  • Reconcile BO account shares position with the back office daily.
  • Reconcile the pay in and pay out daily
  • Setup the BO account opening demat, pledge, un-pledge, confiscation, transfer etc.
  • Send the signed acknowledgement of the above jobs to the concern officers.
  • File the forms and reports properly.
Branch Control
  • Monitor the activities of the branch & report to the HOB accordingly.
  • Send all documents such as acknowledgement, cheques, shares, statements etc. to the branch.
  • Deliver the documents to the concern departments of the main office received from the branch.
  • Receive the documents from the concern department for sending to the branch.
  • Solve the problems of the branch.
  • Visit the branch.
  • Monitor the customers’ balance of cash account.
  • Monitor the Bank balance position.
  • Prepare financial position daily and report to the HOB and HOST.
  • Prepare & validate all vouchers by checking properly.
  • Prepare and maintain Net Capital Balance.
  • Send report on Net Capital Balance to the DSE.
  • Receive customer account opening fee from registration
  • Activate the customer account in the Back Office.
  • Receive cheques from customer against buy of shares.
  • Prepare cheques for the customers and DSE.
  • Deposit cheques to the Bank.
  • Reconcile the Bank Statement.
  • Reconcile the DSE cheque (receive/delivery) with the back office.
  • Reconcile the customers’ accounts.
  • Computer posting of all financial transactions.
  • Prepare daily receipt and payment statement.
  • Prepare accounts i.e. trail balance, profit & loss account, Balance sheet, cash flow etc.
  • Ensure budgetary control by doing budget variance analysis.
  • Filing of all vouchers.
  • Provide tax certificate to the customers.
  • Responsible for over all day to day administration activities of the Broker House.
  • Ensure logistics support of the broker house.
  • Maintenance of employees present and leave record.
  • Liaison with Head office regarding miscellaneous issues of the unit.
Internal Control & Compliance
  • Educate the employees of the house about the compliance guideline.
  • Ensure to follow the compliance rules strictly by the house.
  • Take necessary steps to renew the licenses i.e. broker registration certificate, DP registration certificate, Authorized Representative certificate etc in time.
  • Surveillance books and records of the house for ensure the rules are complained.
  • Take necessary steps to overcome the discrepancy.
  • Scrutinize the Account Open Forms and documents.
  • Prepare the answers of any query asked by any authority or management.
  • Compliance report to concern authorities in time.
Information and Communication Technology
  • Maintain databases in the back office software.
  • Ensure smooth operation of the systems i.e. trading work station, back office PCs, back office server, CDBL computers, branch and others.
  • Liaison with the vendor of back office software regarding any maintenance or development issues.
  • Send portfolio statement daily to the customers through e-mail.

Source : United Enterprises & Co. Ltd. booklet

Company & Its Activities

 Legal Status

United Enterprises & Co. Ltd. was incorporated as a private limited company in Bangladesh under The Companies Act 1913 on April 03, 2010 vides registration No. C-7668/527. The company started its operation from June 2010.

 Nature of Business Activities

The company is a securities company and a member of Dhaka Stock Exchange Limited (Membership No. 207) and in engaged as a brokerage in the capital market.

 Operation of Business

The head office of United Enterprises & Co. Ltd. is situated in 195 Mitijheel C/A, Sena Kallyan Bhaban (12th Floor), Dhaka-1000. On June 01, 2010 it inaugurates. It’s Gulshan Branch in 101, Gulshan Avenue, R.M. Center, Gulshan-2, Dhaka-1212 started on November, 2010. Nikunjo Branch in DSE Bhabon, Nikunjo on proposal.

  Services of United Enterprises & Co.  Ltd.

 Brokerage Services

  • Trade Execution (Dhaka Stock Exchange Ltd.)
  • Pre-IPO Private Placement Opportunities through UECL
  • Appointment of committed, dedicated and expert Executives extensively.
  • Opportunities for trading in different financial instruments.
 Research Services
  • Free access to company research reports through the web-site.
  • Customized research recommendation.
Sectors and company research reports.Safe keeping of securities
  • UECL has an exclusive arrangement for clients to keep their shares in the vault. The brand new vault is well protected.
  • The Company is capable to verify and register client’s securities in his name or in the name of client’s portfolio account at a minimum of cost.
Significant Accounting Policies

Basis of Accounting
The accounts are prepared & maintained under the historical cost convention on a going concern basis and in accordance with Companies Act, 1993 and Bangladesh Accounting Standards BAS)

Revenue Recognition

Revenue is recognized based on share transactions amount which comprises of brokerage commissions, service charges, transaction fees and custody fees and capital gain. In case of interest on bank accounts and fixed deposit, revenue is recognized as the interest accrues unless collectibles is in doubt.


Under the Income Tax Ordinance 1984, UECL is subject to tax on income derived from share transaction amount of its trading activities. Provision for income tax has been calculated on the other income of the country. The company’s trading income is subject to deduction of tax at source on brokerage commission as final settlement.


Buy/Sale Order Book & Register

Securities Exchange Rules 1987, 4(1)

  1. A buy/sell order form is to be maintained through which all clients shall place their transactions order. This form is to be signed by the clients. No order shall be entered in the Brokers workstations without written order form. [this clause is extremely important as the main risk of a brokerage house is involved with it and nay misunderstanding regarding the order shall be verified with this document.]
  2. All these orders should be chronologically recorded in a register mentioning the name and address of the client, the name and number of the securities to be bought or sold, the nature of transaction and the limitation, if any, as to the price of securities.
  3. No sell order to shares shall be entered without holding the shares by the Broker or having the shares in the Broker clearing account (in case of CDBL traded issues). CDBL regulations require the shares intended to be sold out be transferred from the BO account of the client to the clearing account of the Broker.
  4. No buy order shall be entered without having positive balance (Credit balance) with the broker excepting a margin Agreement for credit facility. [In case the accumulated purchase amount exceeds the credit balance of a particular client, excess amount should be deposited with the broker on the same day]

Trade Confirmation Report

Securities Exchange rules 1987, 4(5)

  1. A member executing an order of buy or sell of a customer shall within 24 hours of the execution of the order, transmit to the customer a confirmation note.
  2. Such Confirmation Note shall include the following information, namely (a) Order execution date
    1. Name and number of the securities
    2. Nature of transaction (spot, ready and bought or sold)
    3. Share price
    4. Commission
    5. Whether the order is executed from the members own account of from the market.
  3. Duplicates or counterfoils of confirmation note shall be preserved with the signature of the customer.
 Settlement Process

The settlement date is the day on which either the payment to cover purchases or the securities to cover sales must be in the company’s account. When the clients purchase/buys a security, payment must reach United Enterprises & Co. Ltd. account before execution of trade. When the client sells a security, the share certificates must be delivered to United Enterprises & Co. Ltd. before trade execution.

Clearing & Settlement

  1. Shares and money are settled with the clearing & settlement department of the exchange according to the category of the company. For “A, B, N” category shares, money and shares are to be settled on T+3 (Transaction date + Three working days).
  2. In case of shares in “Z” Category shares and money shall be deposited on T+5 and cleared on T+9.
Payment Policies
United Enterprises & Co. Ltd. prefer that the client makes payment before the execution of a buy order or holding shares before the execution of a sell order.

Payment against purchase

Account payee cheques for payments on purchase of securities must be made payable to United Enterprises & Co. Ltd.

Acceptable Forms of Payment

The following are considered acceptable forms of payment:

  • Client’s personal Cheque (A/C payee)
  • Corporate Cheque
  • Bank Draft
  • Pay order
Unacceptable Forms of Payment

The following must not be accepted as payment:

  • Travelers Cheque
  • Money Order
  • Cash
  • United Enterprises & Co. Ltd. Executive’s personal or business Cheque
  • Cheques drawn on foreign bank
  • Cheques once returned by the bank for insufficient funds or any other reason will not be entertained by UECL.
Balance Payment


  1. Obtaining written requisition form duly signed by the client(s).
  2. Signature verification
  3. Verification of matured balance
  4. Cheques signed by authorized signature of UECL
Related Policies
  1. All payments shall be made through A/C Payee Cheque.
  2. No Cash or Cash Cheques shall be provided to the client(s)
Expenses, Commission & Fees

There are two types of charges borne by the client:

  1. CDBL
  2. Brokerage Commission
  1. Commission Schedules
Commissions are incurred with every buy/sell transaction by an UECL brokerage account.
  1. General Securities
The Account Executive should use the following two-step process to calculate brokerage commission:
  1. Determine the commission based on the schedule.
  2. Add procurement charge (if any) to commission.

Account Closing Form: After formally requesting  the DP/Brokerage to close an account, the client will have to submit the A/C closing form duly signed & verified.

Share Transfer Procedure: A written for warding with the procedure duly filled & signed CDBL prescribed Form.

Share receiving through Link A/C: After receiving the shares thorough link A/C, the concerned officer will perform formalities and receive the report generated the following day. The concerned officer will then import the shares and export it to the customer A/C.

Sponsor share sell/buy Procedure: Execution will only have done after disclosure of the information by the client through the stock exchange.

Customer A/C Operation: Consolidated customer  A/C will only be used for customer’s receivable and payable purposes and DSE payable and receivable purposes. Every moth end the company can take out the commission income from the consumer A/C and transfer it to General A/C for day to day expenses.

Compliance Authority: Chief Executive Officer shall act as the compliance authority of UECL.

Proper control over Trader Limit Facilities: The Authorized traders trading limit will be bounced by the server setup. However with an approved permission by the concerned authority, the trader may increase/decrease his/her limit.

Net Capital Balance: The accounts of the company will create a net capital balance as per the requirement of DSE.

Time Limit of Purchased Share for Selling: In case of physical share purchase, the client will have to withdraw share within four months from purchase date for the purpose of Name Transfer. And discrepancies found on the certificates, the client have to inform the brokerage company within 150 days from purchase date. Facility to do so, the brokerage will not take any liabilities for any losses caused by fake/claimed and type of error shares.

Matching of order :

All orders with price equal to or better than the opening price will match automatically. Orders which are at the most favorable price, that is, at the lowest selling or highest buying price, shall be executed first. If two or more orders are listed in the order book at the same price, the oldest order shall be executed first.

Queue priority:

Orders that cannot immediately be executed shall be queued for future execution in a specific order of priority mainly based on price and time of entry. In cane an order is executed partly, the remaining part of such order shall not lose its priority. The queue priority shall be determined by the system through an interactive process and the order of priority displayed by the system of conclusive.

An overview of SWOT Analysis :

It has always been important for a business to know and understand how it fits in and interacts with the surrounding environment on both an internal (office/factory/shop environment) and external view (how the business operates with the outside world). Researching the environment will benefit the organization and/or management team by putting in a position to develop a strategy for both the long and short term.

Analyzing the Business

The most influential way of doing this is to perform a SWOT analysis of the company. It is a common phrase used to abbreviate Strengths, Weaknesses, Opportunities and Threats. Each term is a heading for a separate analysis of the business but they can be related as seen below:

Strengths provide an insight to your business Opportunities
Weaknesses in the business can cause immediate Threats

It is important to know that the SWOT analysis is only based upon information that is known by the assessors (you), and is seen as perhaps the more basic approach of analyzing a business’ position: but SWOT is still a powerful tool when looking for immediate benefits.
Performing SWOT

Recognizing the Strengths and Weaknesses before tackling the Opportunities and Threats is the best way to approach the analysis: the more Strengths and Opportunities the better they can both be seen as the bigger influences for the success of your company. One needs to be aware that the most important rule is not to leave anything out no matter how small the issue may be.

There is no fixed way of doing a SWOT analysis, but it should be done in a way that one feel most comfortable with, and more importantly that you understand it. The objective is to be in a  position where the company can determine a strategy for the future to improve.

Company’s overall performance

SWOT Analysis of United Enterprises & Co. Ltd.

Strong Corporate Identity

United Group is a leading group of companies in Bangladesh. As United Enterprises & Co. Ltd. is a subsidiary of this organization, with its strong corporate image and identity it can better position in the minds of customers. This image has helped the company to grab the market share very rapidly.

Strong Employee Bonding and Belongings

United Enterprises & Co. Ltd. employees are one of the major assets of the company. The employees have a strong sense of commitment towards organization and also feel proud and a sense of belonging towards the company. The strong organizational culture of the company is the main reason behind this strength.

Efficient Performance

United Enterprises & Co. Ltd. provides hassle free customer service to its client base comparing to the other brokerage houses of Bangladesh. The client service is excellent in this regard.

Empowered Work Force

The human resource of United Enterprises & Co. Ltd. is extremely well thought & perfectly managed. As from the very first the top management believed in empowered employees, where they refused to put their fingers in every part of the pie. This empowered environment makes United Enterprises & Co. Ltd. a better place for employees.

The employees are not suffocated with the authority but they are able to grow as the organization matures.

Strict adherence to compliance standard

The organization abides by all the rules and regulations provided by the regulatory bodies. It has proven reputation in serving customers by maintaining strong compliance practices and presence in the market. This strict adherence to compliance standard is an excellent strength for the company.

Modern Equipment & Technology

Untied Enterprises & Co. Ltd. owns the state of the art information technology in Bangladesh regarding operating brokerage services. Its ultramodern system starting from terminal PCs to HUB are based on international Standards. IT infrastructure is well equipped and managed which is also maintained with high level of professionalism.


More Innovative Services must be offered : In order to be more competitive in the market United Enterprises & Co. Ltd. should come up with more new & attractive packages & services.

Low Paid up Capital : The paid up capital of the company is relatively low. For widening the operating network & services more capital is required. In the long run this might turn out to be negative issue.

Not offering margin loan to clients : Institutional brokerage houses can extend substantial margin loan to their client with a minimum cost, for example Dhaka bank, Al Arafah Bank. United Enterprises & Co. Ltd. due to its low paid up capital can not extend margin loan.

Limited no. of trading machines: The present number of trading machine are limited in a sense that when the market will grow the company might face problem with this limited no of trading machines to cooperate.


Countrywide network: United Enterprises & Co. Ltd. has a good network of side office in the country. By utilizing the parent company’s expanding operation & widening network UECL might increase its profitability as well as tapping the market & secure its existence in the long run.

Huge Market: The capital market is Bangladesh has tremendous potentials. The size of the market is still small compared to the size of GDP. People as a whole had a misconception about the capital market. But gradually we are finding signs of maturity. The market capital will go up rapidly with the entrance of Padma Shatu, Grameen Phone etc. This is a great opportunity for the company to actively participate in the market.

Government & Regulatory Body’s initiative for market growth:  Policymakers are gradually taking the securities market as one of the most important factors for development. Entrepreneurs’ mindset is also changing day by day. Govt. initiatives in capital market investment in our country made it attractive to the general people to invest. Such as introducing book-building system to ensure IPO fair price, tightening listing rules to bring more companies to capital market Here United Enterprises & Co. Ltd. has a large opportunity to tap the growing market.

Weak marketing message by other organizations: The basic assumption of the trade business is that customer will come to the organization and ask for service that is why brokerage houses are not that much enthusiastic about letting know their services features. This is an opportunity for UECL.


Upcoming Brokerage Houses: The upcoming brokerage houses posses a serious threat to the existing networks of UECL. With the new entrance the intensity of competition will rise further and the company will have to develop strategies to compete against the threat.

Rivalry of Existing Competitors on commission & Others: A large number of brokerage service provider increase rivalry because they are competing for the same customers and resources. The rivalry intensifies if the companies have similar market share, leading to a struggle for market leadership. Competition among the existing service providers in the area of commission, earnings and extending various facilities are also present.

Similar services are offered by other Banks & Financial Institution: Now day’s different private banks are also offering similar type of services with an almost similar profit margin. So, if all competitors fight with the same weapon, the natural result is declining profit.

Industrial downward trend due to recession, inflation & political instability: Bangladesh is economically unstable country. Due to political instability our economy faces a huge challenge. This creates a downward pressure in all sectors of business.

Review of UECL SWOT Analysis

Table : 03: UECL SWOT Analysis

– Strong Corporate Identity
– Strong Employee Bonding and
– Efficient Performance
– Empowered Work Force
– Strict adherence to compliance
– Modern Equipment & Technology
– More Innovative services must be
– Low paid up capital
– Not offering margin loan to clients
– Limited no. of trading machines
– Countrywide network
– Huge Market
– Government & Regulatory Body’s
initiative for market growth
– Weak marketing message by other
– Upcoming Brokerage Houses
– Rivalry of Existing Competitors on
commission & others
– Similar services are offered by other
Banks & Financial Institution
– Industrial downward trend due to
recession, inflation & political
Net Capital Balance of UECL

Net Capital Balance
As at 31st December, 2010

Liquid Assets: Rule 2 (bb) Tk. Tk.
1 Cash in Hand and Cash at Bank 9345956.10
2 Invested in listed Securities at market value 39726550
3 Receivable from Clients
4 Interest, Dividend or Commission receivable
5 Receivable from Clearing House 8700.00
6 Treasury bills issued by the Government of Bangladesh
7 Value of investment in Govt. bonds and certificates
8 Other receivables in ordinary course of business
Total Liquid Assets 49081206.10
(Less) Designated Liabilities : Rule 2 (aa) Tk. Tk.
1 Overdraft & Loan from bank
2 Payable to Customer
3 Payable to Clearing House 5996734.67
4 Accrued Expenses 442554.00
5 Taxes Payable
6 Other Payables in ordinary course of business
Total Designated Liabilities 6438288.67

            Net Capital                                                                                              42642917.43


Untied Enterprises & Co. Ltd. has established its image as one of the best service provider for its potential customers. From above discussions and basic understandings while working in the organization following recommendations can be formulated for the organization.

  • By adopting the principles of good governance at all decision making levels, UECL must show that corporate governance is a management enhancement tool. T his is one of the factors that can give confidence to business partners and facilitates co operation with parties in international financial centers, which already adopts such principles.
  • UECL should more clearly define respective responsibilities of staffs, managers, board of directors and shareholders in the attainment of goals and establish a procedure of sanctions attached to these responsibilities.
  • It should improve more on management control systems comply religiously with corporate governance principles and the international financial standards especially aspects that impact on assessment & management of risks, transparency & viability.
  • Intensify consultation within the profession in order to become a real source of idea for the development of brokerage house system within the region.
  • Demand is shifting continuously, and these shifts have so much to do with today and the future as with the past.
  • In order to increase the profitability & reduce the risk, UECL should maintain a well-balanced portfolio. The more diversified the portfolio, the lesser the risk of losses.
  • It is to be keeping with mind that competitors can copy product but cannot copy the understanding & expertise.
  • Many consumer segments still demand branches & use them while the other seek the reassurance of the branch if they do not use them, so branch should be based on proper demand identification.
  • UECL should continuously redefine new demand for financial, brokerage services & ensure that this understanding is unique & actionable.
  • Establish priorities for capabilities for new product investment as well as better ways to minimize gaps in strategic management.


United Group is one of the largest and most reputed companies in Bangladesh. Its reputation is based on quality, strong customer orientation, smooth distribution network, the technological sophistication that characterizes its products and projects and an impressive record of achievements across six decades.

Under his dynamic and charismatic leadership, the Group rapidly rose to the peak of success and has 17 large Industrial and Commercial Units in one fold which include Power Distribution, Spinning Mills, Education, Hospital, Pharmaceuticals & Healthcare, Travels, Real Estate & Brokerage House (Member of Dhaka Stock Exchange)

The company strengthened its presence in the country’s growing stock market with launching a subsidiary- United Enterprises & Co. Ltd. (UECL) in 2010 which is offering full-fledged brokerage service for retail and institutional clients.

UECL avoids duplication of business data input from disparate systems & do early manage logs and mandatory information of trading activities which comply with the standards of Dhaka Stock Exchange. UECL provide timely and accurate data for effective planning and decision-making resulting in faster turn around time for business & provide faster flow of data between different departments, enhancing the co-ordination between back office and front office systems and enhance customer and client experience by quickly responding to requests. So most of the investors are satisfied of its service & they can invest to materialize their financial dream into reality.