Remittance resurgence no cure for sickly emerging economies
Larger-than-expected money transfers from migrants overseas have provided a tonic for several sickly economies during the coronavirus crisis, but the outlook for such flows remains fraught with uncertainty even as vaccines are rolled out.
Mexico, El Salvador, Kenya, Pakistan, Bangladesh, Philippines and Sri Lanka are among those enjoying resurgent flows in recent months, helping them narrow current account gaps, stabilise currencies and meet any overseas debt payments.Such countries have led a surprise recovery in remittances in the second half of 2020, as the slowdown in flows amid the pandemic proved less severe than initially feared.
Migrants have cushioned the pandemic’s economic blow, drawing down savings to help out families back home and sending more money via official channels rather than in person, while benefiting from access to state support, including cash handouts, in host countries such as the United States.While vaccinations should help economic activity to return to normal, the risk of mounting job losses as government support unwinds mean such flows, a source of FX revenue and gross domestic product for many emerging countries, may falter in 2021.
Tk 8,000cr Islamic bond for safe water supply.
Bangladesh Bank will issue a sukuk next week, the first of its kind in Bangladesh, to raise Tk 8,000 crore for the implementation of a safe water supply project.The finance ministry is the originator of the Shariah-compliant bond, and the central bank will act as a special purpose vehicle (SPV) for the issuance of the security.A memorandum of understanding between the central bank and the finance ministry was signed yesterday on issuing the bond.
A sukuk is an Islamic financial certificate, similar to a treasury bond, which complies with Shariahlaws.The government began to implement the project titled “Safe Water Supply for the Whole Country” on January 1. The fund raised by the sukuk will be invested in the project.The overall cost of the project is estimated at Tk 8,851 crore, of which Tk 851 crore will be provided by the government, according to a prospectus prepared by both the central bank and the finance ministry. The Department of Public Health Engineering (DPHE) will implement the project by June 30, 2025.
Investors will receive a profit of 4.69 per cent on their aggregate investment in the Islamic bond. The central bank has fixed the rate based on the Bangladesh Government Islamic Investment Bond (BGIIB).The last declared profit-sharing ratio of the six-month BGIIB is 3.69 per cent, and the central bank has added 1 percentage point to settle on the rate for the sukuk. Profits will be paid to investors on a half-yearly basis.A client will have to invest a minimum of Tk 10,000 in the security, and there is no upper limit. Banks, corporate institutions and individuals will be permitted to invest.The central bank will hold an auction next week when Tk 4,000 crore will be mobilised through the sale of the certificates. If the bidding amount surpasses the targeted fund, the auction committee will allocate the certificates proportionately among the bidders.The central bank will raise the rest Tk 4,000 crore in May.
Southeast Bank launches payroll banking services
Southeast Bank Limited launched a new payroll banking services named “Beton Card and Beton Plus Card” for corporate clients on Tuesday. In presence of M. Kamal Hossain, Managing Director of Southeast Bank Limited, Mustafa-E-Zaman, Managing Director of Marma Composite Ltd, officially inaugurated “Beton Card and Beton Plus Card”, said a statement.
The Annual Risk Conference-2020 of Trust Bank Limited was held on Tuesday on a digital platform at Trust Bank Head office
The Annual Risk Conference-2020 of Trust Bank Limited was held on Tuesday on a digital platform at Trust Bank Head office. Faruq Mainuddin, Managing Director & CEO, HumairaAzam, AMD & CRO, and Ahsan Zaman Chowdhury, DMD & CBO, were also present at the conference.