Cumulative written-off bank loans now BDT 414.4 billion

Written-off loans continued to rise until March, 2016 as the banks cleaned their balance sheets by reducing default loans, officials said. Cumulative loans, written off by the banks, rose by nearly BDT 2.0 billion to BDT 414.4 billion during the first quarter of the current calendar year from BDT 412.4 billion three months ago, according to the central bank’s latest statistics. However, the amount of banks’ cumulative written-off loans increased by more than 11.0% to BDT 414.4 billion as of March 31 last from BDT 372.5 billion in the same period of the previous calendar year. During the January-March 2016 period, the amount of written-off loans by six state-owned commercial banks (SoCBs) rose to BDT 220.8 billion from BDT 220.7 billion in the previous quarter. On the other hand, a total of BDT 180.4 billion loans were written off by 39 private commercial banks (PCBs) during the period under review against BDT 179.1 billion three months ago. Loans, written off by nine foreign commercial banks (FCBs), rose to BDT 7.6 billion in the Q1 of 2016 from BDT 7.1 billion in the previous quarter of 2015.

Source:
http://print.thefinancialexpress-bd.com/2016/07/26/147360
http://newagebd.net/242496/banks-write-off-BDT-200-crore-loans-first-quarter/

Bangladesh Bank to set higher credit growth target

Bangladesh Bank may set the private sector credit growth target at 16.5% in the monetary policy for the first half of the fiscal year, in keeping with the present momentum. Governor Fazle Kabir is set to announce the monetary policy today for the first half of fiscal 2016-17 in what will be his first big policy statement since he took over the reins from Atiur Rahman in March. In June last year, the BB set the private sector credit growth target for fiscal 2015-16 at 14.8%, but the mark was crossed in May and it stood at 16.4% at the end of the fiscal year. The government forecast the economic growth pace to be 7.2% for the current fiscal year, while it set the goal of containing inflation within 5.8%. In the monetary policy, the inflation target may be set at 5.5%, lower than the government target. However, no change will be brought to the policy rates as they were cut by 50 basis points in January.

Source: http://print.thefinancialexpress-bd.com/2016/07/26/147359

Banks’ adjustment of over exposure: PCB subsidiaries get ‘breathing’ space

The latest enhancement of paid-up capital by commercial banks for their subsidiaries has given a ‘breathing’ space and scope of adopting existing business to the banks amid the sluggish trend of capital market, the top officials said. As per the approval of the Bangladesh Bank (BB) and the securities regulator, some banks having over exposure expanded the paid-up capitals of their subsidiaries by converting their loans into equities. The bank subsidiaries whose paid-up capitals have been expanded are: AB Investment, Southeast Bank Capital Services, Shahjalal Islami Bank Securities, NBL Securities, MTB Capital, Mercantile Bank Securities and One Securities. Earlier, the parent companies’ loans provided to their subsidiaries were also a component of the capital market exposure. Due to sluggish trend of the capital market observed after 2010-11 stock market debacle, the subsidiaries were not in a situation to repay principal amount and the interests well. The central bank later excluded the banks’ equity investments from the exposure limit following the longstanding demand of the stakeholders.

Source: http://print.thefinancialexpress-bd.com/2016/07/26/147310

Bangladesh Bank says no organizations allowed to invest gratuity funds in NSCs

Bangladesh Bank has said all organizations, including banks and private and government entities, are barred from investing their gratuity funds in savings schemes offered by Directorate of National Savings. The BB on July 20 issued two separate circulars to all scheduled banks and NBFIs, and branches of the central bank reminding them that no organizations were allowed to invest their gratuity funds in any savings tools of DNS including 5-Year Bangladesh Sanchayapatra as per the Sanchayapatra Regulations 1977 (amended-2002). A BB official told New Age on Monday that although there was bar, some banks and private companies had recently invested their gratuity funds in the 5-Year Bangladesh Sanchayapatra violating the regulations. ‘Banks, NBFIs or other organizations are only allowed to invest their provident fund in the 5-Year Bangladesh Sanchayapatra. But they have also invested their gratuity fund in the tools,’ he said. The organizations are allowed to invest their gratuity funds in the Treasury bills and bonds owned by the government. The investment in the DNS’s national saving schemes crossed BDT 300.0 billion in 11 months of the just concluded financial year 2015-2016 against the government target of BDT 150.0 billion for the whole year.

Source:
http://newagebd.net/242490/bb-says-no-orgs-allowed-invest-gratuity-funds-nscs/
http://www.thedailystar.net/business/bb-reminds-banks-not-park-gratuity-funds-savings-certificates-1259401
http://www.dhakatribune.com/business/2016/jul/26/bb-warns-again-about-unlawful-investment-savings-certificates

No loan disbursed from stock market refinance scheme in 3 months

The government’s BDT 900-crore refinance scheme for crash-hit investors failed to stimulate them in making fresh investment as none of the investors received such facility in last three months. The Investment Corporation of Bangladesh, which handles the fund, released around BDT 45.9 million as loans to FAS Capita from the scheme in April 21, 2016. Due to investors’ disinterest about the refinance loan, the supervision committee on refinance scheme in May this year proposed that the finance ministry could extend the scheme by one more year to December 31, 2017. Besides existing tenure of the refinance scheme, the committee also proposed to reduce interest rate on the loan. Following the committee proposal, the finance ministry in June extended the refinance scheme by one more year from December 31, 2016 and reduced interest rate to 7.5% from 9.0% to get better response from the investors. The government’s relaxed policies, however, failed to draw investors’ attention as the ICB is yet to receive any application in this regard. ‘Although various measures have been taken to popularize the fund, no response was found,’ a senior ICB official told New Age recently. Besides, the ICB issued two sanction letters for loan from the refinance fund a couple of months back, but the organizations are yet to receive the letters, he said.

Source: http://newagebd.net/242495/no-loan-disbursed-stock-market-refinance-scheme-3-months/

Standard Chartered to launch video banking in Bangladesh

Standard Chartered Bank said it will soon introduce video banking service for both its Personal Banking and Priority Banking segments in Bangladesh. Video Banking will bring the following benefits to clients: a) More choice, more convenience: Clients have a secure channel to access live, on-the-spot services through video, audio and web chat, giving them a convenient new way to do their banking. b) Document-sharing: Banking consultants can share screens with clients while speaking with them. Both consultant and client will also be able to upload and share documents. c) Access to investment advisor: Priority Clients can have “face-to-face” discussions with investment advisors to explore new wealth management opportunities. This is especially convenient for clients in markets such as Malaysia where branches are spread out geographically.

Source: http://www.daily-sun.com/post/153777