Telcos can’t hold shares in mobile banking companies: Bangladesh Bank
Bangladesh Bank will not allow mobile network operators to hold any shares in the companies which run mobile financial service, according to the BB’s latest draft guidelines on the MFS. The draft guidelines said that the MNOs would just provide networking services to settle clients’ transaction through the MFS. The MNOs have been demanding for long to allow their investment in the MFS operation, but the BB high-ups are openly opposing their (MNOs) demand at different seminars and events as the central bank has decided to follow a bank-led model in this regard. In 2015, Trust Bank decided to form a subsidiary with Malaysia’s Axiata Group to provide the MFS, but the BB did not entertain their initiative. Axiata Group is now holding the majority of shares of Robi Axiata Ltd, one of the MNOs operating in Bangladesh. If approved, Trust Bank would have held the subsidiary company’s 51.0% shares while Axiata would have owned the rest.
Banks asked to impose condition on loans against 11 more item
Bangladesh Bank on Monday asked banks to impose condition for using mandatorily jute bags in packaging 11 more commodities when they (banks) will approve loans to manufacturers and supplier companies of the products. The 11 commodities are onion, ginger, garlic, pulses, potato, flour, chilli, turmeric, coriander seeds and husks of rice and wheat. The BB issued a circular to managing directors and chief executive officers of all banks asking them to follow the directive in line with an inter-ministerial meeting decision taken on April 9, 2017. On October 12, 2015, the central bank had asked banks to impose condition for using jute bags mandatorily in packaging six commodities during loan approval to the manufacturers and supplier companies of the products.
Four state banks’ BDT 277.0 billion caught in legal tussle
The credit amounts of the four state banks that are stuck in lawsuits pending with the money loan court rose BDT 56.0 billion in 2016. Sonali, Janata, Agrani and Rupali had a combined BDT 277.0 billion caught in unresolved cases with the money loan court as of December 2016, up 2.54% on 2015 when it was BDT 220.0 billion, according to Bangladesh Bank data. The huge amount of loans remain stuck with the courts because of a tendency among clients to file writs so they are not declared defaulters, said Md Obayed Ullah Al Masud, managing director of Sonali Bank.
Exporters can repay foreign loans using ERQ fund
Bangladesh Bank on Monday said that the exporters would be allowed to pay instalments of foreign loans from their respective export retention quota accounts. The BB issued a circular to authorized dealer branches of all banks saying that from now on an exporter would be allowed to pay his or her company or subsidiary companies’ foreign loan from the ERQ fund. The exporters earlier paid the instalments of foreign loan converting the local currency Taka to the US Dollar. ERQ account is the portion of export earnings that an exporter saves as foreign currency. With this account balance, exporters were earlier allowed to promote their businesses abroad, open liaison office, and cover import cost of raw materials and machineries without needing prior approval of the BB. A BB official told New Age on Monday that the central bank had taken the initiative to liberalize the country’s foreign exchange regime so that the businesspeople would be able to settle foreign exchange transactions easily.
Govt plans to use $7.55b foreign aid next year
The government is gunning for record foreign aid utilisation next fiscal year with the view to wooing the electorate ahead of the national election scheduled for 2019. Bangladesh could never utilise more than $4 billion of foreign aid in a year, but the government plans to utilise about $7.55 billion of foreign aid in fiscal 2017-18. The disclosure comes after Finance Minister AMA Muhith last week said the budget for fiscal 2017-18 — the last full fiscal year before the elections — will be an exceptional one. The government wants to accelerate the progress of a number of transformational projects such that they can take some shape when the Awami League gets into campaigning mode, said planning ministry officials. Meanwhile, Prime Minister Sheikh Hasina yesterday approved Tk 153,331 crore as the outlay for next fiscal year’s Annual Development Programme, which is 39 percent higher than the current year’s allocation. The government’s own fund contribution has been raised 23.98 percent to Tk 96,331 crore and foreign fund 73.32 percent to Tk 57,000 crore.
Business-friendly VAT rate finalized
The government is set to implement the new VAT law from July this year but with some modifications to give some comfort to businesses and consumers. The development comes after Prime Minister Sheikh Hasina at a meeting on proposed budgetary measures for fiscal 2017-18 on Sunday night gave the nod to the adjustments in the VAT law. He said most of the issues regarding the implementation of the VAT law have been finalized; the rest will be sorted later by the prime minister and the finance minister. Finance ministry officials said the uniform VAT rate under the new law will most definitely be flat 12.0% instead of the 15.0% rate that was envisaged when the law was framed in 2012.
Bangladesh signs two One Belt, One Road (OBOR) deals with China
Bangladesh signed two agreements with China under the OBOR initiative in the global forum that concluded Monday in Beijing with a massage of not pushing any political agenda among the participating countries. Under the couple of deals, China will enhance industrial investment, trade connectivity and finance power-grid upgrading, thermal power, coalmine modernization, tyre-factory projects in Bangladesh, one of China’s key OBOR locations entering the Indian Ocean. Details of the treaties were not available till the filing of the report.
Government shortlists four international companies for Matarbari LNG terminal
Power Cell has short-listed four international firms to build an onshore LNG (liquefied natural gas) terminal under an equity partnership of developer, financier and a state-owned entity of Bangladesh, said officials. The proposed terminal having a capacity of 3.5 million tonnes per year would be built at Matarbari of Moheshkhali Island in the Bay of Bengal, director general of Power Cell Mohammad Hossain told the FE Monday. The short-listed firms have been selected from among 15 contenders that initially submitted expression of interests (EoIs), he said. The short-listed firms are Japan’s Mitsui & Co. Ltd, China’s consortium of China Huanqiu Contracting and Engineering Corporation & Yifeng Industrial Gas Co Ltd, India’s Petronet and Royal Dutch’s Shell EP International Ltd.
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