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TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK

TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK

£

TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK

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Rate last updated: 02/01/2014 11:15:04 AM

Important Business News Extracts May 26, 2016

Corporate tax target at risk as banks’ profit declines

Lower growth in operating profit of major corporate taxpayers has put the revenue authorities in the soup as far as attaining its tax collection target for the current fiscal year (FY) is concerned. The Large Taxpayers Unit of the revenue board’s income tax wing has found that the operating profit of top tax-paying banks posted a slow growth in the calendar year 2015. It will leave an adverse impact on the corporate tax collection. Explaining the situation, the tax official said operating profits of 24 commercial banks, the major corporate taxpayers, grew only 1.38% throughout the last calendar year from January to December. With the poor growth in operating profits the tax officials estimated a fall in taxable profits of the banks. Officials said already the authority was struggling to achieve the high corporate tax collection target with several indicators remaining negative, including the cut in tax rate by 2.5% for banks and financial institutions in the budget for the FY 2015-16. In the first ten months of the current fiscal, the LTU faced a shortfall of nearly BDT 40 billion against its tax collection target. The target for the LTU has been set at BDT 196.8 billion in the FY 2015-16. The sluggish tax collection prompted the tax authority to scrutinize the financial health of the top 24 corporate taxpayers, all commercial banks, to avert possible shortfall in revenue collection by June 30 next. The income tax wing of the National Board of Revenue (NBR) has decided to sit with the representatives of the commercial banks and other large companies to discuss the corporate tax issues. Profit of the top taxpayer Standard Charted Bank declined by BDT 2.2 billion in 2015 while AB Bank’s profit went down by BDT 1.77 billion.

Source: http://print.thefinancialexpress-bd.com/2016/05/26/142423

Government repays BDT 93.5 billion bank loans in 11 months

The government made a huge net repayment to the banking sources against loans in 10 months and 17 days of this financial year because of a surge in the net investment by clients in the national savings certificates and bonds. According to the Bangladesh Bank data released on Wednesday, the government made no net borrowing from the banking sources in the July 1-May 17 period of the FY 2015-16 but made a net repayment of BDT 93.5 billion in the period. The government’s net bank borrowing was also negative in the corresponding period of the FY15 as it had made a net repayment of BDT 69.8 billion. The BB data showed that the government repaid BDT 85.8 billion to the scheduled banks in 10 months and 17 days of the FY16 while it also made a net repayment of BDT 7.6 billion to the central bank against loans, making the government’s overall bank borrowing negative of BDT 93.5 billion in the period. A BB official told New Age on Wednesday that the government had got a respite from the bank borrowing during most of the time of this year as the net investment in the national savings certificates and bonds stood at BDT 231.9 billion in the first nine months (July-March) of the FY16. The government aimed to borrow BDT 150.0 billion from the NSCs in the FY16, but its borrowing through the tools crossed the annual target before the end of this fiscal year as clients continued to invest heavily in the instruments due to low bank deposit rates amid sluggish business climate. According to the Directorate of National Savings data, the net investment in the savings instruments increased by 9.46% to BDT 231.9 billion in the first nine months of the FY16 from BDT 211.8 billion during the same period a financial year ago. The maximum interest rate on NSCs is around 11.5% while the bank rate on deposit is between 6.0% and 7.0%. The government required no big amount of borrowing from the banking sector in the majority periods of the FY16, but it started borrowing since April of this fiscal year after seven months. The government has also taken a plan to take loans amounting to BDT 80.0 billion from the banking sources in May-June of the FY16.

Source: http://newagebd.net/231888/Government-repays-BDT-9350cr-bank-loans-in-11-months/

BSEC likely to approve draft ETF rules today

The Bangladesh Securities and Exchange Commission finally initiated a move to finalize the draft rules on launching exchange traded fund (ETF) on Wednesday, a senior BSEC official told New Age. The BSEC initiative came after the finance ministry in March this year expressed its dissatisfaction over the BSEC’s progress in launching financial derivatives and exchange traded fund for enhancing depth of the capital market. A ministry letter also asked the commission to finalize rules on financial derivatives and ETFs within the stipulated time as per annual performance agreement by June 22, 2016. On June 11, 2015, BSEC chairman M Khairul Hossain at a discussion had said that the commission would finalize rules for exchange traded fund within 2015 that would allow stock exchanges to launch ETFs by 2016. The draft rules on ETF likely to get approval at a commission meeting scheduled to be held today as the issue was included among the agenda of Thursday’s commission meeting, the official said. Once the rules get BSEC approval, those would be published for stakeholders’ opinion, he said. After publication of finalized rules based on stakeholders’ opinion, stock exchanges would be allowed to run such funds, the BSEC official said. An ETF is like a mutual fund that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold. When an investor is going long in an ETF, he/she is buying shares of a portfolio that tracks the yield and returns of its native index. Earlier in October 2014, the Dhaka Stock Exchange, as per its plan to launch two ETFs by December of the year, proposed to allow the bourse to launch ETFs. The two ETFs would be formed based on DS30, the blue-chip index of the DSE, and DSES, its Shariah index. The commission, however, refrained from allowing DSE to launch ETFs in absence of rules.

Source: http://newagebd.net/231887/bsec-likely-to-approve-draft-etf-rules-today/

Jobs scarce despite higher economic growth: Centre for Policy Dialogue

Bangladesh has failed to create adequate jobs despite higher economic growth in recent years, the Centre for Policy Dialogue said yesterday. The independent think-tank said the economy is estimated to register 7 percent growth in the outgoing fiscal year, largely supported by the pay hike of public employees, after maintaining more than 6 percent growth in the past decade. But the economic growth, particularly since 2013, could not result in enough job creation, it said. The CPD said the number of jobs rose impressively during 2002-2013, by 13.6 lakh per year. But the number appears to have fallen to only three lakh a year since 2013, it said, referring to the latest labour force survey by Bangladesh Bureau of Statistics. The number of jobs declined by 12 lakh in the manufacturing sector in two years since 2013, said Towfiqul Islam Khan, a research fellow of the CPD, at a press briefing at Cirdap auditorium in Dhaka. The CPD organsied the briefing to unveil its analysis on Bangladesh’s economy in fiscal 2015-16 that ends on June 30.

Source:
http://www.thedailystar.net/business/jobs-scarce-despite-higher-economic-growth-cpd-1229371
http://newagebd.net/231889/gdp-growth-not-translated-into-job-creation-cpd/

Centre for Policy Dialogue (CPD) against launch of new VAT law as disputes remain

The Centre for Policy Dialogue (CPD) said Wednesday the government should not implement the new VAT law without resolving the issues raised by the businesses. Any failure to do so might lead to various complexities, resulting in a substantial fall in the overall revenue mobilization in the next fiscal, the private think-tank said. The government is set to introduce the new VAT Act from July with a uniform rate of VAT at 15.0% across the board. But, the country’s business organizations have long been protesting it. The organization expressed the view that the government should have implemented a ‘progressive’ VAT system, considering the SMEs. Completion of online registrations was also necessary, it felt. The CPD also said the government should enact some laws to bring back the money, already siphoned off by some businesses, for reinvestment in the country. The think-tank was highly critical of the government’s growth estimate at over 7.0% for the ongoing fiscal year. Quoting the quarterly labour force survey of July-September period in 2015, the organization said the employment rate remained low, which should have been higher in line with the economic growth rate. It also said BBS has showed that private investment in terms of GDP also declined in the year under review. The private investment was 21.8% of GDP during FY 16, down by 0.3% point over that of the previous year.

Source:
http://print.thefinancialexpress-bd.com/2016/05/26/142422
http://www.dhakatribune.com/business/2016/may/26/cpd-stresses-quality-growth

A holdup in new VAT law

The government may put the new VAT law on hold for another year in the face of opposition by business leaders. The new development runs counter to Finance Minister AMA Muhith’s commitment to the International Monetary Fund that the law would be enforced from JulyA high-level meeting of the government has recently discussed the issue and decided not to implement the law next fiscal year. The stance has already been communicated to the National Board of Revenue and the next budget proposal has been prepared accordingly. The new VAT law was passed in parliament in 2012, but its implementation was delayed time and again due to opposition from businessmen and a lack of preparation by the tax authority. The IMF delayed an instalment of its Extended Credit Facility due to a delay in the new VAT law. The finance ministry had informed the IMF that prior to placing the new law in parliament in 2012, the new VAT law underwent extensive consultation with the stakeholders. Despite this, the new law has come under criticism by the business community. To counter the criticism, the NBR and Federation of Bangladesh Chambers of Commerce and Industry formed a joint committee which submitted its report in January last year. As per their recommendations, some amendments were made to the law, and passed again in parliament in September. Major changes in the new law are: VAT will be a single rate at 15%, the tax base will be determined on the basis of actual transaction values and there would be no pre-approved values or truncated base and limited exemption.

Source:
http://www.thedailystar.net/business/holdup-new-vat-law-1229365
http://www.dhakatribune.com/business/2016/may/26/cpd-stresses-quality-growth

World Stock and Commodities

Index NameClose ValueValue ChangePercentage Change
Crude Oil (WTI)*$49.81+0.25+0.50%
Crude Oil (Brent)*$50.08+0.34+0.68%
Gold Spot*$1,231.09+6.68+0.55%
DSEX4366.03(28.03)(0.64%)
Dow Jones Industrial Average17,851.51+145.46+0.82%
Nikkei 22516,805.63+48.28+0.29%
FTSE 1006,262.85+43.59+0.70%

Exchange Rates 

USD 1BDT 78.35*
GBP 1BDT 115.23*
EUR 1BDT 87.60*
INR 1BDT 1.16*

*Currencies and Commodities are taken from Bloomberg.

AN IMPORTANT MESSAGE FROM

EMRANUL HUQ

MANAGING DIRECTOR & CEO OF DHAKA BANK LIMITED

Dear Valued Patrons,

At the very onset, let me express my heartiest gratitude for allowing us to serve you and I also wanted to reach out to you directly with an assurance that Dhaka Bank is fully equipped to support you during this difficult time.

Last couple of weeks ago we all were living in a peaceful condition, performing our daily tasks freely and perfectly. Entire economy and business environment was also in a good shape, until COVID-19 put a forceful stoppage to the overall life style and economy of the world. We all know that social distancing and cleanliness are the keys to prevent this pandemic. Hence, we urge your conscious effort to limiting public interaction and suspending wherever possible.

YOUR SAFETY MEANS EVERYTHING TO US
In this current situation, Dhaka Bank and its employees are beside you where we are fully online, either working from home or at our offices under a robust Business Continuity Plan (BCP) to serve you with limited branch banking and a full-fledged alternate delivery channel services.

WE WILL TAKE CARE OF YOUR BANKING NEEDS
Our state of the art Mobile App, Dhaka Bank GO (Click https://bit.ly/2WVfieu) and Internet Banking - Dhaka Bank Direct gives you the freedom of banking online anytime from anywhere. You can check the balance and transfer money to any designated Banks including any Dhaka Bank or bKash Account, make utility bill payments and mobile top-up through our Mobile App and Internet Banking Services. Our ATMs are also running efficiently with availability of sufficient cash for your convenience where you can make cash withdrawals whenever the need arises. Mentionable, the withdrawal of cash from any ATMs within Bangladesh with Dhaka Bank Debit Cards are absolutely free of charges up till April 30, 2020 (Dhaka Bank will bear the cost). Our corporate customers can also use our completely safe and secured online platform Dhaka Bank C-Solution for Payments, Inter Bank Fund Transfers, etc.

Moreover, to fulfill your urgent requirement, we have a limited no. of branches up and running by ensuring all kinds of precautionary and safety measures for you.

GET IN TOUCH IF YOU ARE IN EXTREME EMERGENCY
In case of extreme emergency and facing difficulties in conducting banking transactions, please let us know through our 24/7 Contact Center number 16474 (or, dial +8809678016474 for ISD/Overseas Calls). We are always with you to combat your difficulties.

WE WILL FREQUENTLY UPDATE YOU
As you know we are going through a critical phase and the situation is novel to all of us. We are getting lot of new information from various sources everyday about COVID-19 which will be shared at www.dhakabankltd.com.

Thank you for your trust and continued support to us. I firmly believe that jointly we will be able to combat this situation and win against all the odds.

Please stay home, stay safe and take care of yourself and family.

Best regards,

Emranul Huq
Managing Director & CEO
Dhaka Bank Limited

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