Interest rate spread drops slightly in October
Overall interest rate spread in the country’s banking sector fell slightly in October as the commercial banks slashed their interest rates more on lending than that of deposits, officials said. The weighted average spread between lending and deposit rates offered by the commercial banks came down to 4.50 per cent in October 2017 from 4.55 per cent in the previous month, according to the central bank’s latest statistics released on Monday. The spread was 4.70 per cent in October 2016. The central bank is now working to keep the spread within 4.0 per cent in the near future, according to officials. The issue was discussed at the board of directors meeting of the Bangladesh Bank held at its headquarters in Dhaka on Monday with BB governor Fazle Kabir in the chair. “We’ve informed our board about the latest trend in the spread,” SK Sur Chowdhury, deputy governor of the BB, told the FE after the meeting without elaborating. The BB officials, however, said the banks have already been advised to reduce their interest rate spread through improving their efficiency as well as profitability instead of slashing interest rates on deposits.
Now Sonali blames other banks, wants its money back
Sonali Bank yesterday pleaded with the Bangladesh Bank to help it recover Tk 895 crore that was debited from its account with the central bank to settle the acceptance bills relating to Hallmark Group loan scam. The board and the management of the state-owned bank claimed that the companies, which got the fund from its current account, were a part of the scam. The bank’s board of directors led by Chairman Md Ashraful Moqbul sat with the central bank to discuss the issue. BB Governor Fazle Kabir and three deputy governors were present at the meeting held at the BB headquarters. Based on forged documents, Hallmark took around Tk 3,000 crore loans from Sonali’s Ruposhi Bangla Hotel branch in 2012. Upon Sonali’s acceptance, 41 banks bought letters of credit of Hallmark and paid the money accordingly. When these banks started claiming their funds, Sonali refused to pay. Later, many of these 41 banks requested the central bank to intervene. The BB paid them off by debiting the money from Sonali’s current account. Sonali has requested the BB not to debit any more money from its current account. Sonali Bank’s data showed that the central bank has so far debited Tk 895 crore from the state lender’s account to adjust Hallmark Group-related inland bills. Still, the state-owned bank owes Tk 273 crore more to different banks against the accepted bills. BB’s spokesperson and Sonali Bank’s chairman and managing director declined to comment on the matter.
Strategy soon to distribute development dividends to all
The government plans to introduce a maiden national strategy for unlocking financial opportunities for all through distributive digital channels. The disclosure came Monday at a programme being held in Dhaka for learning about digital payment system with participation from home and abroad. “Digitisation will be the core pillar of our upcoming National Financial Inclusion Strategy,” said Bangladesh Bank (BB) Deputy Governor S K Sur Chowdhury while inaugurating the five-day-long joint learning programme (JLP). Currently, the ministry of finance and the BB are jointly preparing a study paper on the National Financial Inclusion Strategy that will be finalised by March in the upcoming calendar year. The central bank of Bangladesh and the Alliance for Financial Inclusion (AFI) have jointly organised the programme focusing digital payment system to expedite the ongoing financial-inclusion campaign across the country.
Stressed advances now 17pc of banks’ outstanding loans
As of 2016, the country’s banks’ stressed advances — the summation of non-performing, restructured and rescheduled loans — stood at 17 per cent of their total outstanding loans, according a research study conducted by LR Global Bangladesh, an affiliate of the New York-based LR Managers Investments. In absolute terms, the size of NPL stood at USD 7.8 billion and that of restructured and rescheduled loans at USD 6.7 billion. At the same time, provision coverage exhibited a declining trend, indicating enhanced vulnerability of the entire banking sector. “Although the NPL scenario in the SCBs gained more attention from different corners, the asset quality in the PCBs has also deteriorated to a serious level,” the research paper noted.
Twenty nine large development projects limp
Implementation progress of 29 development projects with allocation above BDT 3.5 billion remained slow in the first four months of the current fiscal year 2017-2018 than the average progress rate of all projects under the Annual Development Programme (ADP). In July-October of the FY18, the government’s 54 ministries and divisions managed to spend only BDT 238 billion or 14.51% of total allocation of BDT 1,640 billion of the ADP. The government allocated BDT 942 billion or 57% of ADP for the projects named as large ones by the planning ministry. Though the average progress rate of the projects stood at 18% in July-October, the implementation rate of the 29 projects under 14 ministries was dismal and ranged between zero% to 12.23%, according to the data of the Implementation Monitoring and Evaluation Division of the planning ministry.
NBR to introduce digital help desk for businesses
The customs authority is going to introduce a digital help desk with the objective to reduce hassles of businesses in obtaining information related to export and import. “We are planning to launch the online service on January 26 next year in order to facilitate trade,” said Mohammad Ehteshamul Hoque, first secretary for customs modernisation of the National Board of Revenue. The customs authority plans to introduce the system as people in many cases have to go from desk to desk for customs related information such as HS code, valuation, and rules of origins for various products. For the system termed as “national enquiry points”, the NBR is developing software with the support from USAID. After the launch, anyone staying at any corner of the world will be able to submit queries about import, export and trade, he said.
Ceramics hold bright prospects
The ceramic tiles industry holds immense growth prospects both at home and abroad as Bangladesh is producing high quality products at competitive prices, said a noted entrepreneur. Today, locally made ceramic tiles are competitive in terms of cost at global level. The quality is also better than those made in countries such as China. “We think we are better and we are introducing new technologies every day to achieve global standards,” said Sk Bashir Uddin, managing director of Akij Group. The group made foray into the ceramic industry only five years ago to tap both the growing domestic and international markets. Akij Group started with a daily tiles production capacity of 220,000 square feet. Now it makes about 500,000 square feet of tiles daily. “This was the biggest plant when we started. Today, we are also the biggest plant.” The company has introduced many new tiles into the market and was the first one to roll out digital printed tiles. Akij Group has also started exporting tiles, albeit irregularly.
Transit, power import, trade to figure in talks with Bhutan
Transit, power import and bilateral trade issues will get top priority in the upcoming commerce secretary-level meeting between Bangladesh and Bhutan to be held in Cox’s Bazar this month, officials said. The two-day meeting will begin on December 21. Commerce secretary Subhashish Bose will lead the Bangladesh side while the Bhutanese delegation will be led by the secretary of the Economic Affairs ministry of Bhutan. The last commerce secretary-level meeting between the two countries was held in Thimphu, the capital of Bhutan, in March last year. “We will discuss several bilateral issues in the upcoming meeting in Cox’s Bazar. We will request the Bhutanese delegation to help implement the BBIN Motor Vehicles Agreement and speed up the process of import of power from Bhutan,” a high official of the commerce ministry told the FE.
‘Bangabandhu hi-tech park to boost Rajshahi’s economy’
State Minister for Information and Communication Technology (ICT) Zunaid Ahmed Palak has said Bangabandhu hi-tech park will play a vital role in boosting the current economy of the region by creating new technology-based employment. He said the park will create new employment for more than 14,000 youths both male and female here. He came up with the observation as the chief guest while distributing rehabilitation bank cheques worth Tk 4.57 million (Tk 45.70 lakh) among 85 families at regional office conference hall of Bangladesh Scouts in city on Sunday afternoon.
Problems at riverbed hindering Padma Bridge construction
Planning Minister AHM Mustafa Kamal Monday said certain physical changes in the mighty Padma River are hindering the ongoing construction of the bridge over it. “Bangladesh has no previous experience of building this kind of large bridge. A lot of physical obstacles are emerging (in the Padma River). Mud and sand are being removed (from the piling place). These factors are hampering the work,” he said while briefing reporters in Dhaka. He made the observations at the end of a meeting that reviewed the progress on 86 big ongoing development projects under the Annual Development Programme (ADP) at the Planning Commission (PC). Mr Kamal sat with the secretaries of the line ministries and project directors of those projects, each having an allocation of Tk 3.50 billion or more. The Planning Minister said a new hammer for piling work has reached the project site that would now help expedite the construction work of Padma Bridge. “At today’s (Monday) meeting, the senior secretary (of the Bridges Division) has assured us that the Padma Bridge construction work is on track,” he added. Meanwhile, the Bangladesh Bridge Authority (BBA) has been facing difficulties in carrying out the piling works at some 14 piers out of total 42 piers due to the shifting character of the riverbe6d in the Padma River.
Int’l Trade and Tourism Expo from Dec 12
The 11th Asian International Trade and Tourism Expo 2017 begins at the International Convention City Bashundhara (ICCB) in Dhaka on December 12, aiming to give impetus to the country’s economy. The five-day event is expected to offer opportunities for greater interactions among local and global businesses at one place.
Move to raise senior citizens’ age bar to 65
A senior minister has said that the government is mulling to acknowledge people as senior citizens when they attain 65 years of age. At present, people aged 60 years or above are acknowledged as the country’s senior citizens. Finance Minister AMA Muhith came up with the notion during a speech he delivered as the chief guest at an agreement signing programme organised by senior citizen medical resort “Abshar” at a city hotel, reports UNB.
BTRC invites applications for 4G licence
Bangladesh Telecommunication Regulatory Commission (BTRC) on Monday invited applications for the licence of the fourth generation (4G) mobile phone services in the country, reports UNB. Interested operators can submit their applications until January 14 next to have the licence. The proposals were sought following a decision made in a special meeting of the commission in the afternoon, BTRC Secretary Sarwar Alam said while talking to UNB in the evening. He said the tender inviting offers for the licence for the 4G mobile network in the country was published at the BTRC’s official website. The list of eligible operators will be published on January 25, the BTRC Secretary said, adding that the auction for the 4G spectrum will be held on February 13 and the names of the winners will be announced on February 14.
Petrobangla seeks Tk 26b to pay VAT, SD to NBR
The state-owned Petrobangla has sought over Tk 26 billion from the government for paying the outstanding value added tax (VAT) and supplementary duty (SD) to the National Board of Revenue (NBR). The company owed over Tk 40 billion to the revenue board in VAT and SD arrears during the period between November 2016 and June 2017, officials said.
Local and Global Stock Indices
|Index Name||Close Value||Value Change||Percentage Change|
|DSEX||6,262.77||↓ 33.43||↓ 0.53%|
|DJIA||24,231.59||↑ 58.46||↑ 0.24%|
|FTSE100||7,338.97||↑ 38.48||↑ 0.53%|
|Nikkei 225||22,611.61||↓ 95.55||↓ 0.42%|
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)*||$ 57.59||↑ 0.12||↑ 0.21%|
|Crude Oil (Brent)*||$ 62.54||↑ 0.09||↑ 0.14%|
|Gold Spot*||$ 1,276.00||↓ 0.18||↓ 0.01%|
Major Currencies Exchange Rates Movement in Last Seven Days
|USD 1||BDT 82.07|
|GBP 1||BDT 110.52|
|EUR 1||BDT 97.43|
|INR 1||BDT 1.27|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.