Banks now to get cheaper BB funds

Bangladesh Bank has made funds cheaper for all banks by reducing its repo rate by 75 basis points to 6 percent. The decision was made yesterday, a couple of days after the BB slashed the cash reserve requirement or CRR by one percentage point to 5.5 percent. But both the decisions will take effect on April 15, according to two circulars issued by the central bank yesterday. The BB, however, kept the reverse repo rate unchanged at 4.75 percent. Repo is a short-term fund that the central bank gives to commercial banks in case of cash shortfall, while reverse repo is excess money that banks keep with the central bank. The BB has already faced severe criticism from different quarters over its decision to cut the CRR. The decision came on Sunday after Finance Minister AMA Muhith held a meeting with BB Governor Fazle Kabir and directors of private banks.

Source:
http://www.thedailystar.net/frontpage/banks-now-get-cheaper-bb-funds-1557763
http://today.thefinancialexpress.com.bd/first-page/bb-cuts-banks-crr-effective-from-apr-15-1522778069
https://businessnews-bd.net/cuts-crr-four-years/

Bangladesh Bank sells $27m to 10 banks

The central bank of Bangladesh has sold US$27 million more to 10 commercial banks to meet the growing demand for the greenback in the market. “We’ve sold the foreign currency to the banks on Tuesday at market rate to settle import payment bills particularly for fuel oils, food grains and fertilizers,” a senior official of the Bangladesh Bank (BB) told the BBN in Dhaka. He also said the central bank may continue providing such foreign currency support to the banks in line with the market requirement.

Source: https://businessnews-bd.net/bangladesh-bank-sells-27m-10-banks/

10 banks flouting central bank directive to keep interest rate spread under 5%

The Bangladesh Bank issued the directive in order to make the savings schemes more attractive as well as keep the interest rates on loans business-friendly. Although the Bangladesh Bank has strictly directed commercial banks to maintain their interest rate spread under 5%, at least 10 private banks are not following the directive, according to central bank sources. Five foreign banks – Standard Chartered Bank, State Bank of India, Woori Bank, Citibank N.A., and HSBC Bank – and five local banks – Brac Bank Ltd, Dutch-Bangla Bank Ltd, Uttara Bank Ltd, Premier Bank Ltd, and NRB Commercial Bank Ltd – were found to have an interest spread – the difference between interest rates on credit and savings – greater than 5% in March this year. Of them, the Standard Chartered Bank topped the list with 8.23% interest rate spread, followed by Brac Bank’s 7.35%. Sources said Bangladesh Bank issued the directive to maintain an interest rate spread under 5% in order to make the savings schemes more attractive as well as keep the interest rates on loans business-friendly.

Source: http://www.dhakatribune.com/business/banks/2018/04/03/10-banks-flouting-directive/

BB fixes fees for loan, lease

Bangladesh Bank (BB) has fixed the same fees or charges or commissions against credit or lease for all Financial Institutions (FIs). “Loan application fees will be maximum Taka 200 and the document processing fees, CIB charge, stamp charge and legal and valuation fees will depend on the actual cost,” said a BB circular here today, BSS reports. The circular also said fees or penalty interest or profit for delaying loan installment will be maximum two percent with interest rate. In case of repayment of loan or lease before the expiry, the maximum amount of the payment fees or similar fees will be two percent of the outstanding loan or lease. In the case of adjustment before the schedule time of loans given in the cottage and micro sector, any fee will not be taken. No charge will be taken from the customer in case of giving balance confirmation certificate for half yearly basis credit or lease calculation. In case of giving more than twice the balance confirmation certificate as per demand of the customer, the maximum charge will be Taka 200 per time. BB asked the financial institutions to follow the circular.

Source:
http://www.theindependentbd.com/post/144287
http://www.newagebd.net/article/38248/bb-specifies-charges-fees-for-loans-lease-of-nbfis

Private sector credit growth continues to rise

Private sector credit grew 18.49 percent in February, up from 18.36 percent a month earlier and way past the central bank’s target of 16.3 percent, dispelling the notion of an ongoing liquidity crisis in the banking sector. For the best part of 2017 the private sector credit growth has been on the rise, prompting the Bangladesh Bank in January this year to lower the banks’ loan-deposit ratio ceiling to 83.5 percent from 85 percent. Bankers insisted that the move created a severe liquidity crisis but the latest data from the BB suggests otherwise. In the name of the liquidity crisis, private banks, by way of its directors, particularly those who are politically linked, managed to persuade the BB to lower the cash reserve ratio by one percentage point to 5.5 percent.

Source: http://www.thedailystar.net/business/private-sector-credit-growth-continues-rise-1557703

Inflation drops slightly in March

The point-to-point inflation rate in March dropped to 5.68 per cent compared to that of the previous month (February), official data showed. Bangladesh Bureau of Statistics (BBS) data, unveiled on Tuesday, showed that the point-to-point inflation decreased slightly by 0.04 percentage points in last month compared to 5.72 per cent in February. The national statistical body showed that the inflation in March of the current financial year (FY), 2017-18, however, increased by 0.34 percentage points compared to the same month in the previous FY. According to the BBS data, the point-to-point inflation rate in March of FY 17 was recorded at 5.39 per cent.

Source:
http://today.thefinancialexpress.com.bd/first-page/inflation-drops-slightly-in-march-1522778119
http://www.thedailystar.net/business/inflation-falls-568pc-march-1557697

Export earnings decline by 1.38pc in March

The country’s export earnings in March dropped by 1.38 per cent to $3.05 billion, compared to the corresponding month of last calendar year, according to officials data released on Tuesday. In March 2017, the export earnings were $3.09 billion. The earnings in March this year also fell short of target by 3.19 per cent, it showed. The overall export earnings in the first nine months of the current fiscal year 2017-18, however, stood at $27.45 billion, marking a 6.33 per cent growth. The country fetched $25.81billion in the corresponding period of last fiscal. Earnings from readymade garments (RMG) export during the nine-month period stood at $22.83 billion, marking a 9.11 per cent growth over the corresponding period of the FY 2016-17. Export earnings from woven items grew by 6.75 per cent to $11.51 billion from $10.78 billion in the same period of the last fiscal. The knitwear export stood at $11.32 billion during the period, marking an 11.61 per cent growth, as against $10.14 billion in the same period of the FY17. Woven and knitwear items’ export earnings exceeded the target by 4.03 per cent and 2.03 per cent respectively.

Source:
http://today.thefinancialexpress.com.bd/last-page/export-earnings-decline-by-138pc-in-march-1522778402
http://www.newagebd.net/article/38249/export-earnings-dip-in-march-pulling-down-9-month-growth
http://www.thedailystar.net/business/export/exports-decline-138pc-1557694

Economy encountering money market, BoP imbalances

The ongoing chaos in the country’s financial market is the manifestation of inefficiency in managing the macro-economy, economists said. They warned that measures taken lately to shore up liquidity in banks could stoke inflationary pressure. Their observations came following the government’s decision to deposit 50 per cent of state enterprises’ funds with private commercial banks (PCBs) from the previous level of 25 per cent and cut in Cash Reserve Requirement (CRR) by 1.0 percentage point. The central bank on Tuesday decided to slash the CRR by one percentage point to 5.5 per cent until December 31 this year. The decision to this effect was taken earlier in a meeting with the directors of the banks, where the finance minister was present. The holding of the meeting has drawn widespread criticism. The central bank also extended the deadline for meeting the revised limit of Advance-Deposit Ratio (ADR) by banks for three months through March 31, 2019, instead of December 31, 2018.

Source: http://today.thefinancialexpress.com.bd/first-page/economy-encountering-money-market-bop-imbalances-1522777853

Pvt banks to give Tk 160cr to PM’s fund

The Bangladesh Association of Banks (BAB), a forum of private banks’ directors, has taken up an initiative to raise Tk 160 crore for the Prime Minister’s Relief and Welfare Fund. The BAB circulated a letter to all private banks last week saying the 30 old banks will donate Tk 5 crore each while the remaining 10 new banks Tk 1 crore each. The amount will be given from the banks’ corporate social responsibility (CSR) funds, chief executives of a number of banks said. Prime Minister Sheikh Hasina yesterday invited over the banks’ directors and chief executive officers along with their spouses for tea at her Gono Bhaban residence in the capital.

Source: http://www.thedailystar.net/business/banking/pvt-banks-give-tk-160cr-pms-fund-1557679

Prime Bank gets new AMD

Prime Bank’s deputy managing director Habibur Rahman has been promoted to the post of additional managing director. Rahman started his banking career with AB Bank in 1985 and joined Bangladesh Bank as an assistant director the following year, Prime Bank said in a statement yesterday.

Source: http://www.thedailystar.net/business/banking/prime-bank-gets-new-amd-1557667

Midland Bank gets new AMD

Mohammad Masoom joined Midland Bank Limited (MDB) as Additional Managing Director (AMD). Prior to taking over the new assignment, he served in Bangladesh Finance and Investment Company Limited (BD Finance) as its Managing Director and CEO. Mr. Masoom, a seasoned banker, has three decades of hands on extensive and versatile banking experience.

Source: http://today.thefinancialexpress.com.bd/stock-corporate/news-briefs-04-04-2018-1522776044

EBL gets new DMD

Chowdhury MAQ Sarwar has recently joined Eastern Bank Ltd (EBL) as deputy managing director (DMD). Prior to joining EBL, he was the Consultant of Islami Bank Bangladesh Ltd. A distinguished banker with 34 years of experience in banking, Mr Sarwar played a significant role in thought leadership in developing Internal Control and Compliance functions for the banking industry. He started his career with IFIC Bank as probationary officer.

Source: http://today.thefinancialexpress.com.bd/stock-corporate/news-briefs-04-04-2018-1522776044