PKB set to become scheduled bank
Probashi Kallyan Bank (PKB) is set to go into operation as a scheduled bank by March as the government has completed all preparations in this regard, sources said. To this effect, Financial Institutions Division (FID) has sent a summary paper to the finance minister, seeking his approval for issuing a gazette to begin its commercial operation on a limited scale, they said. FID has already prepared a draft gazette that was also sent to the minister. According to Clause 4 (5) of Probashi Kallyan Bank Act 2010, the bank will be able to carry out commercial and banking activities. Besides, Clause 4 (7) of the Act has stated that PKB can be converted into a scheduled bank with approval from Bangladesh Bank, the bank’s document reads. It will be able to apply to the central bank for its conversion into a scheduled bank after getting approval from the finance minister. A senior PKB official said now the paid-up capital of the bank is Tk 1.0 billion. In 2015, the government approved a proposal for raising the paid-up capital of the bank from Tk 1.0 billion to Tk 4.0 billion after issuing a gazette notification in this regard. The bank also needs about Tk 3.0 billion (Tk 300 crore) more as paid-up capital for switching to its scheduled operation. Of the amount, the government provided PKB with Tk 150 million to start its commercial operation and Wage Earners’ Welfare Board (WEWB) gave Tk 500 million to meet new capital requirement for the proposed commercial bank.
Loan, not easy equity from EEF: BB for mandatory property mortgage as guarantee
The central bank now suggests providing loan instead of equity from the Equity and Entrepreneurship Fund (EEF) so the money can be recovered in the event of project failure, officials said. Such a recommendation comes from the Bangladesh Bank (BB) as a large number of so-called entrepreneurs got away with the public money from the Fund. Presently, the ‘equity model’ is followed in case of EEF enterprises where the government is a party with 49 per cent share while entrepreneurs own 51 per cent of the stakes. In this case, the entrepreneurs who run the businesses do not feel responsible for making the enterprises profitable or returning the money to the government exchequer. The BB favours following ‘loan model’, charging 3.0 per cent simple interest on the money to be lent out from the Fund to those who want to run enterprises with the capital support. As the EEF policy is under a recast, the BB also suggests making mortgage of properties mandatory against loans so that the money could be recovered by selling those off.
Young officials steer the wheels of country’s oldest bank: Pubali Bank MD tells FE
Pubali Bank Ltd enjoys a solid financial position performed by ‘diligent and assiduous’ business functionaries, mostly young officials. “Depositors and our business partners remain safe, cocooned in our portfolio, enjoying the prudent service delivery,” managing director and chief executive officer of Pubali Bank Ltd, Abdul Halim Chowdhury told the FE in an interview. The first commercial bank of the country will celebrate the completion of 60 years of its service in May next year.
Chinese party closer to 25pc stake in DSE
The consortium of the Shanghai Stock Exchange and the Shenzhen Stock Exchange is one step closer to the 25 percent stake of the Dhaka Stock Exchange and becoming its strategic partner after the premier bourse’s board yesterday accepted its proposal. Approval from the stockmarket regulator is the final hurdle for the Chinese consortium, which offered Tk 990 crore for the shares as well as technical support worth $37 million (about Tk 300 crore). “We will send the investment proposal of the Chinese party to the Bangladesh Securities and Exchange Commission by this week,” said KAM Majedur Rahman, managing director of the DSE, right after a board meeting. The proposal trumped the bid from an Indian consortium led by the National Stock Exchange (NSE), which last week had engaged in fervent lobbying with the BSEC to persuade the DSE to go for its lesser offer. The proposal trumped the bid from an Indian consortium led by the National Stock Exchange (NSE), which last week had engaged in fervent lobbying with the BSEC to persuade the DSE to go for its lesser offer. The Indian consortium has offered Tk 675 crore for the shares and wanted two seats at the DSE board. In contrast, the Chinese party sought a seat at the DSE board and assured that it will not ask for any return on its investment for 10 years.
Make arbitration act global
Analysts have suggested amending the Arbitration Act 2001 to make it effective and compatible with global developments in arbitration. “There is a demand (for it)…while the money loan court act also needs to be revised,” said Barrister Margub Kabir while presenting a keynote at a roundtable organised by Bangladesh International Arbitration Centre (BIAC) in the capital on Saturday. Barrister Ajmalul Hossain co-authored the keynote at the event themed “Creating an Investment-friendly Access to Justice: Can Alternative Dispute Resolution (ADR) be an Effective Remedy in Commercial Disputes?”. Kabir observed that although mediation has been made mandatory in both the Code of Civil Procedure 1908 and the Money Loan Court Act 2003, it had not attained the projected success in settlement of disputes. “For example, the mandatory provision for mediation comes into play after a party institutes litigation and the defending party appears in the litigation and files written statement,” he said. Cabinet Secretary Mohammad Shafiul Alam stressed amending the laws related to arbitration and adding BIAC as a third-party institution or platform to deal with ADR. He requested the Law and Justice Division to think over the issue very seriously so that some reforms in this regard can surface by June. The experts said the Bangladesh Arbitration Act 2001 should be amended to limit court intervention and to improve enforcement of arbitral awards to improve the worsening situation. The experts also called for amending the Money Loan Court Act 2003 to encourage pre litigation mediation that will allow parties to try mediation even before filing a case with the law court.
BD making progress in graduation from LDC: Says UN resident coordinator
UN Resident Coordinator and UNDP Resident Representative in Bangladesh Mia Seppo praised on Monday Bangladesh’s progress in graduating from Least Developed Country (LDC) category. Lauding Bangladesh’s support for Rohingya people, she said the United Nations (UN) will continue its support for addressing Rohingya issue. Ms Seppo gave her assurance during a view-exchange meeting with Commerce Minister Tofail Ahmed at the latter’s secretariat office. “Bangladesh is making progress towards its graduation from LDC status. It is a tremendous example and also a remarkable journey,” she said. Ms Seppo added: “Bangladesh maintains competitiveness. It will be able to diversify the economy and achieve inclusive growth. The country creates jobs for young people.”
Gas prices to go up again
Gas prices are set to increase at least twice this year with effect from April and October as 28.32 million cubic metre of pricy natural gas would be added to the daily national supply from imported Liquefied Natural Gas in two phases. Earlier, the Bangladesh Energy Regulatory Commission raised the gas prices by 22.7 per cent on an average in two phases –– from March 1 and June 1 in 2017, said officials.
BPC for new oil pricing formula
Bangladesh Petroleum Corporation has put forward a proposal to the energy ministry to introduce an automated pricing formula to adjust petroleum prices against international prices on a monthly basis. If the formula is introduced, prices of diesel, kerosene, and furnace oil will go up in the country.
Metro rail spending meagre until December last
Only 13 per cent of Bangladesh’s maiden metro rail (MRT-6) project has been implemented, in terms of spending allocation, until December last, officials said Monday. They said state-owned Dhaka Mass Transit Company Limited (DMTCL) spent Tk 28.82 billion until last year out of the total estimated cost of Tk 219.85 billion for the Uttara-Pallabi-Agargaon-Framgate-Motijheel metro rail line project.
Rising imports raise concern, says economist Mansur
Economist Ahsan H Mansur believes import spending may balloon to $60 billion this fiscal year, reports bdnews24.com. At the current exchange rate, the amount will be approximately Tk 5.0 trillion, which is Tk 1.0 trillion more than the national budget for fiscal year 2017-18 and Tk 500 billion more than the probable budget for the coming financial year. Mansur said the rapid rise was a matter of some concern. In an interview with the news agency, the economist said imports had risen 29 per cent in the first half (July-December) of the current fiscal year and spending on imports was rising by the month. More letters of credit are being issued as well. “According to my calculations, the country’s import spending will pass $60 billion.” Asked about the cause of the deficit, Ahsan Mansur, Executive Director of Policy Research Institute, said: “The recent leap in spending is largely the result of necessary materials being imported for the Rooppur Nuclear Power Plant project. Spending has also risen as a result of increasing imports of rice, fuel oil, capital machinery and raw materials for construction.” An estimate on the amount of raw materials and machinery imported for the Rooppur project in the July-December period was not available. But, in that period, spending on food imports (rice and wheat) increased 212 per cent, capital machinery import spending increased 34.58 per cent, fuel oil import spending rose 28 per cent and raw material import spending rose 15 per cent. According to the information released by Bangladesh Bank on Sunday, letters of credit amounting to $40.23 billion were opened in the July-December period, a 75 per cent increase year-on-year.
Policy on cards for apparel buying houses
The government is set to frame a policy to bring in discipline and ensure accountability among the buying houses in the export-oriented apparel industry. The commerce ministry has already prepared a draft that seeks to get buying houses registered with the Export Promotion Bureau. Without registration with the EPB, no buying house will be able to hand over letters of credit on behalf of buyers to manufacturers, according to the draft, which was sent to stakeholders for vetting last month. “This is an initial draft. Our spirit is to expand our export market by creating a good reputation of our sector,” said Md Abdur Rahim Khan, deputy chief at the commerce ministry’s textile cell. The move comes after some incidents of fraudulence by some buying houses. Last year, 26 Bangladeshi garment exporters became victims after two local garment buying houses, Vanguard and ASM Apparels, placed work orders on behalf of the “importer” Y&X, saying that the latter is owned by a Bangladeshi-born British citizen named Manjur Billah. The duo offered higher prices on the condition that the raw materials have to be bought from select textile factories in China. The deception came to light after the first batch of consignments was left unclaimed for over one month at a UK port. Until now, there has been no policy on buying houses and there is no controlling authority for them, Khan said.
UK now checking Biman’s eligibility
An independent auditor yesterday started assessing whether Biman Bangladesh Airlines is eligible for a certificate, a prerequisite for resuming direct cargo flights to the United Kingdom. The certificate is called “Air Cargo or Mail Carrier operating into the Union from a Third Country Airport (ACC3)”. Jayne Davy arrived on Sunday and will work till Thursday to report her findings to the UK Department for Transport, Shakil Meraj, Biman’s general manager for public relations, told The Daily Star. Biman sources said the auditor would go for a first-hand experience to see whether the air cargo or mail security operations of the airport meet ACC3 checklist.
Bangladesh finally ushers in 4G era
Bangladesh has entered the era of 4th generation (4G) broadband cellular technology. The government formally handed over 4G licences to four mobile operators of the country through a function in the capital on Monday. Immediately after the handing over of the licences, top three mobile operators – Grameenphone, Banglalink and Robi – started to offer 4G network service in various parts of the country, including different parts of the capital. “This is a historic moment in the digitisation of Bangladesh,” said Post, Telecommunication and ICT Minister Mustafa Jabbar in the ceremony. “Mobile phone technology will be the key medium of digital transformation in the country.” Noting that some mobile operators are charging each customer Tk 110 fee for replacement of their current SIMs with 4G SIMs, the telecom minister termed it ‘illogical’. “I would request the mobile operators not to charge extra fee for such SIM replacement for 4G,” Mr Jabbar added. Speaking on the occasion, Chairman of Bangladesh Telecommunication Regulatory Commission (BTRC) Shahjahan Mahmood said overall quality of mobile service should make uplift along with the launching of 4G.
Operators to offer 4G on 3G data packs
The top three mobile operators rolled out the much-awaited 4G service in the capital and some other major cities last evening — within minutes of receiving the licence from the government. Grameenphone, Robi, and Banglalink, which together account for more than 97 percent of the country’s mobile subscribers’ base, are offering the faster internet under their existing 3G data plans, much to the concern of customers. They are worried that the volume-driven data plans would be exhausted faster than on 3G network, pushing up their consumption and monthly bill. “Faster speed means faster consumption of bandwidth volume than before,” said Shahjahan Mahmood, chairman of the Bangladesh Telecommunication Regulatory Commission, at the licence-giving ceremony last evening at the Dhaka Club. But he hopes customers would be happy with the faster speed.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
|DJIA||25,219.38||↑ 19.01||↑ 0.08%|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 62.16||↑0.48||↑0.78%|
|Crude Oil (Brent)||$ 65.38||↓0.29||↓0.44%|
|Gold Spot||$ 1,342.08||↓4.38||↓0.33%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 82.99|
|GBP 1||BDT 115.95|
|EUR 1||BDT 102.78|
|INR 1||BDT 1.29|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.