TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK

TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK


TT-Clean: 77.1 | TK BC-Selling: 78.1
TK OD-Sight: 76.88 TK | TC-Selling: 78.1 TK

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Rate last updated: 02/01/2014 11:15:04 AM

Important Business News Extracts – June 12, 2017

Review cap on credit card interest

About 70.0% of credit card-users pay off their loans before incurring any interest, leaving banks to rely on the remainder to make profits, said bankers. The proposed 5.0% cap on interest rate of consumer loans will take a toll on earnings, as the cost of fund for the rest 70.0% users has to be included into the pricing of the 30.0%, it said. The ABB also pointed out four major new provisions, which require the central bank’s urgent review. Interest on consumer credit now stands at 11 to 12.0%, which means the cap would bring down the interest on the payment tool to 16-17% from the existing highest rate of 36.0%, it said. The reason for such high rate is most issuing banks offer 45-50 days interest-free period to cardholders, the association said. Though, cardholders do not incur any interest for the period, the issuing bank has to absorb the cost of fund for these days, it said.

Source: http://www.thedailystar.net/business/review-cap-credit-card-interest-1418953

Forex reserves not enough: IMF

The International Monetary Fund has raised questions about the adequacy of Bangladesh’s foreign currency reserves, now more than USD 32.0 billion, at a time when the government seems rather satisfied with the sum. The amount is enough to foot 8.95 months’ import bill of Bangladesh, but given the country’s slow export growth and decline in remittance inflows, the safe reserve limit should be equal to 9.6 months’ import bill, the IMF said last week. In the first ten months of the fiscal year, the average monthly import bill was USD 3.62 billion. A USD 10-billion sovereign wealth fund was in the works to channel the reserves to various infrastructure projects, and the cabinet even gave its nod to the proposal. The IMF in its assessment last year had said a reserve level equivalent to 8.5 months’ import bill was adequate. But since then several macroeconomic developments have taken place that have changed the baseline scenario, including the current account on which the reserve adequacy assessment is based. The current account has swung from a previously projected deficit of 1.3% of GDP in fiscal 2015-16 to a surplus 1.7%, mainly on subdued imports.

Source: http://www.thedailystar.net/business/forex-reserves-not-enough-imf-1418947

‘Banks to bear transfer cost of remittance up to USD 200.0

Bangladesh Bank has taken a decision to allow non-resident Bangladeshis to send their hard-earned money home without cost up to USD 200.0 with a view to encouraging them to remit greenbacks through banking channel. The central bank will ask the commercial banks to reimburse the cost of remitted money from their respective fund of corporate social responsibility programme, a BB official told New Age on Sunday. An NRB will be allowed to remit the money amounting up to USD 200.0 twice in a month without counting any charge, according to the central bank decision, he said. Banks here in Bangladesh will pay the charges to the foreign banks and exchange houses on behalf of the remitters, said the official. A large number of NRBs are now using ‘hundi channel’, an illegal channel of money transfer, to send the money to their near and dear ones because of a lower rate of the US dollar against the taka in the banking sector. Besides, the local agents of the hundi cartel have also introduced a door-to-door service for sending money to the relatives of the NRBs resulting in a major setback in the inflow of remittance in recent months, he said. The hundi cartel is now using the mobile financial services to send money on real-time basis to the relatives of the NRBs, he said.

Source: http://www.newagebd.net/article/17550/banks-to-ber-transfer-cost-of-remittance-up-to-200

Buyback policy for government securities on the cards

The government has planned to introduce a buyback arrangement for its securities to bring dynamism in the secondary market, officials said. They said the Ministry of Finance, Bangladesh Bank (BB) and Primary Dealer (PD) banks will work jointly to formulate a policy and implement the plan. At present, the government buys back its securities from the market as and when it thinks necessary due to absence of any policy. If implemented, the buyback would take place under the policy. The latest move came against the backdrop of falling trend in trading at the secondary market mainly due to the lack of adequate securities.

Source: http://print.thefinancialexpress-bd.com/2017/06/12/175118

Dhaka Stock Exchange (DSE) gets poor response to share sales to strategic partner

The board of directors of Dhaka Stock Exchange has rejected the prices quoted by four entities for the DSE’s shares in their bid to become strategic partner of the demutualised bourse. The bourse will consult with the Bangladesh Securities and Exchange Commission in this regard before taking any further decision, the DSE MD said. There are clear directions in the Demutualisation Act over the issue and the bourse will follow the act in consultation with the commission, Majedur said. Under the Exchanges Demutualisation Act, 2013, the BSEC may grant more time to the DSE to find a strategic investor. If the DSE fails to find any strategic investor for it within the extended deadline, the commission may allow the bourse to issue shares to any other investors as par the process its board determines.

Source: http://www.newagebd.net/article/17554/dse-gets-poor-response-to-share-sales-to-strategic-partner

Greater VAT paying cos to come under LTU

All large-scale businesses, each paying BDT 100.0 million annually in tax on average for last three years, are set to come under close supervision of the Large Taxpayers Unit (LTU) under VAT department from next fiscal. The National Board of Revenue (NBR) has framed fresh guidelines on selection of large taxpayers for the unit. Currently, a total of 156 large businesses pay VAT under the LTU, contributing 56.0% to the aggregate VAT collection. Those businesses paid BDT 304.17 billion or around 58.0% of the total value-added tax collected in the FY 2015-2016.


NBR to give services thru government digital centers

Access to Information Programme under Prime Minister’s Office and National Board of Revenue have signed a memorandum of understanding to deliver services to the citizens through Digital Centre’s located in Unions, Municipalities and City Corporations. To achieve the Vision-2021 and to provide easy, quick and low cost services to the doorsteps of the citizens, the a2i has signed different MoUs with the government and non-government organisations, said a press release on Sunday. The a2i Programme of the Prime Minister’s Office-with technical support from UNDP and USAID launched the doorsteps services through Digital Centre to engage and empower the Bangladeshi society.

Source: http://www.newagebd.net/article/17556/nbr-to-give-services-thru-govt-digital-centres

Venture firms seek 10-year tax holiday

Venture capital firms have called for a-10-year tax holiday for the fund managers given their importance in nurturing startups and the long-term nature of their investments. “The budget has made the Alternative Investment Funds tax-free, which is a welcome move,” president of Venture Capital and Private Equity Association of Bangladesh Shameem Ahsan said. “However, such tax exemption should also be applicable to fund managers or the entities who are actually managing those funds,” he added, highlighting the importance of fund managers in nurturing the startups and shouldering the risks. “The usual tenure of venture capital funds is 10 years while it takes seven to eight years to get the return on this type of investment,” said Shameem Ahsan, who is the General Partner of Silicon Valley-based Fenox Venture Capital.


Square Pharma to subcontract production

Square Pharmaceuticals Ltd will subcontract some of its production to two local companies to meet increasing demand for existing medicines and introduce new ones. The two medicine-makers are Naafco Pharma Ltd and Sharif Pharmaceuticals Ltd, says a post on the Dhaka Stock Exchange website. Naafco Pharma started production of human medicines in 2015. The current production range encompasses tablets, capsules, powders, pellets, injectables, and liquids in the form of suspensions and solutions, according to the company’s website. Sharif Pharmaceuticals set up a state-of-the-art manufacturing facility in 2011.

Source: http://www.thedailystar.net/business/square-pharma-subcontract-production-1418950

Policy soon to boost leather goods, footwear export

In the policy option, it was proposed providing 16.5% cash incentives to the exporters against their exports and setting up a national design centre at a cost of BDT 600 million crore to develop design of the leather goods and footwear. As per the proposal of the draft policy, Leather-goods and Footwear Manufacturers and Exporters Association of Bangladesh (LFMEAB), a trade body representing the sector, will receive the fund from the government to set up and operate the design centre. The exporters will continue to receive the cash incentives upto 2021 as instrumental to promote the export. At present, the country annually exports about USD 1.16 billion of leather goods and footwear products. In the proposed policy, the export is targeted to reach 5.0 billion when the country’s total export will stand at 60 billion.

Source: http://print.thefinancialexpress-bd.com/2017/06/12/175126

Local and Global Stock Indices

Index NameClose ValueValue ChangePercentage Change
Nikkei 22520,013.26↑104↑0.52%

World Commodities

CommodityClose ValueValue ChangePercentage Change
Crude Oil (WTI)*45.83↑0.19↑0.42%
Crude Oil (Brent)*48.15↑0.29↑0.61%
Gold Spot*1,266.76↓11.25↓0.88%

Major Currencies Exchange Rates Movement in Last Seven Days





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