Important Business News Extracts – February 06 2017
Banks asked to give NRBs door-to-door services for remittance
Bangladesh Bank on Sunday asked the top 20 remittance receiving banks to provide door-to-door services to non-resident Bangladeshis by appointing agents abroad to increase the inflow of remittance through the banking channel. The BB directive came after the country’s inward remittance dropped in January year-on-year for the seventh month in a row. Earlier the BB observed that the inward remittance plunged in 2016 as a good number of expatriate Bangladeshis preferred illegal ‘hundi’ conduit to banking channel in sending their money. The central bank at a meeting on Sunday asked the 20 banks to sign agreement with more foreign exchange houses and foreign banks so that non-resident Bangladeshis feel encouraged to send their hard-earned money through the banking channel.
Bankers seek commission waiver for small remitters
Top 20 remittance-recipient banks proposed to meet their commission on maximum US$200 inward remittance from their own CSR funds instead of deducting it from the remitter’s money. Such waiver of commission on small amounts of remittance, they think, will encourage remitters to send their money home through proper channel and thus boost the slow inflow of remittances. The recommendation was made at a view-exchange meeting with the officials of Bangladesh Bank (BB) in the central bank headquarters in Dhaka Sunday with BB Deputy Governor SK Sur Chowdhury in the chair. The chief executive officers (CEOs) and managing directors (MDs) of the commercial banks believe that such initiative for adjusting their commission against their CSR (corporate social responsibility) expenditure will help boost the flow of inward remittances.
Sonali Bank’s woes are showing no signs of respite, with the latest data showing that more than one-fourth of its total loans have become default — a development that is causing anxiety to both the finance minister and the central bank governor. At the close of 2016, the country’s second largest bank’s default loans stood at BDT 102.5 crore against the total loans of BDT 384.3 billion. In other words, 26.7% of Sonali’s loans have defaulted, up from 25.0% percent a year earlier. The average amount of default loans in the banking sector is 10.3%, whereas it is 27.0% in Sonali, said Bangladesh Bank Governor Fazle Kabir. Also, of Sonali’s 1,208 branches 370 are loss-making, according to Kabir.
Banking commission at the end of govt tenure: Finance minister
Finance minister AMA Muhith on Sunday said the government might appoint a commission for the country’s banking sector at the end of the present government’s current tenure. Although Muhith ruled out appointing a commission in 2015, he said the government is now considering to put it in place before 2019. Muhith was addressing the annual meeting of the state-owned Sonali Bank in the city. The current tenure of the present government would expire in January 2019. Muhith hoped that the next elected government would implement the recommendations of the proposed commission. He admitted that the government in the past did not accept recommendations from various sectors for appointing a commission. Centre for Policy Dialogue, a local think-tank, has long been demanding for appointing a commission against the backdrop of a series of loan scams in the banking sector.
DSE backs relaxed rules for brokers, merchant bankers
The Dhaka Stock Exchange yesterday urged the regulator to allow stockbrokers and merchant bankers to make share transactions in their clients’ margin accounts for another year so that they could recoup the losses from the market crash of 2011. The discretionary power, if the proposal gets through, will allow stockbrokers and merchant bankers to make buy-sell decisions without asking the clients for additional funds, in an effort to hold back the current downward trend in the market. Although the Dhaka bourse’s key index and turnover hit record highs last month, it declined more than 6.0% in the last eight trading days. DSEX, the benchmark index of the Dhaka Stock Exchange, crossed the 5,700-point mark for the first time in January, while turnover scaled a six-year high of BDT 21.0 billion. But the index closed at 5,322 points yesterday, while turnover came down to BDT 6.8 billion. Although the portfolio value of the margin accounts rose a bit during the price rally, they are still burdened with negative equity and the current downward trend worsens the scenario.
Experts suggest foolproof cyber security to protect taxpayers’ info
Policy makers and experts on Sunday stressed the importance of a foolproof digital security for the National Board of Revenue for protecting the country’s revenue system and taxpayers’ information from any cyber-attack. It will be disastrous for the tax administration and taxpayers if high value and sensitive information related to tax fall in the hands of wrong people, they said at a seminar ‘the digital NBR and its cyber security’ arranged by the revenue board at its conference room in Dhaka. State minister for information communication and technology Zunaid Ahmed Palak said the government gave the highest priority to cyber security and protection of national critical infrastructures. The NBR is one of the critical infrastructures of the country, he said adding that the ICT Division had identified 21 government organizations including Bangladesh Bank and Civil Aviation Authority, Bangladesh as critical infrastructures in the country.
The Alliance for Bangladesh Worker Safety, a consortium of North American fashion retailers and buyers, has cut business relations with 11 more Bangladeshi readymade garment factories in January on charge of insufficient progress in remediation. The move has brought the total number of factories suspended by the Alliance to 127. The suspended factories are: Fareast Dresses Ltd, Defoin, Sun Seed Apparel Ltd, Kimia Garments Industries Ltd, Kimia Apparels Industry Ltd, Eden Apparels Ltd, Western Dress Ltd Unit 2, Jann Composite Mills Ltd and Zisas Fashion Ltd in the Dhaka city, Sun Seed Apparel Ltd at Savar, and Claxton Apparels and Textiles Ltd in Narayanganj. Most of the factories have failed to provide evidence of remediation and few of them failed to remove lockable exits from the units, the buyers’ group said in a recent statement.
The government is set to approve a project for building infrastructure for the proposed Chinese Economic and Industrial Zone (CEIZ) at Anwara in Chittagong this week, officials said. The zone will be built under the Chinese government soft loan of USD 280.7 million, they added. To this effect, the cabinet committee on economic affairs (CCEA) will approve the project proposal in its meeting on Wednesday.
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