Banking system trails economic growth pace
Bangladesh’s banking system, especially the central bank, falls behind the country’s growth, creating a mismatch, says an expert. “If you look at the major indicators of Bangladesh’s economy, including GDP and budget, it has jumped many, many times over the decades. But the banking sector has not,” former Governor of Bangladesh Bank Dr. Mohammed Farashuddin told a regional banking conference in Dhaka on Sunday. Bangladesh Institute of Bank Management (BIBM) has organised the two-day event which is being participated by banking delegates from Bangladesh, India, Nepal and Bhutan. “The capacity of the banking system, particularly the central bank, to deal with the growth of the country as well as the enormous complexities of the world has not developed,” he said. “And that is the reason for many of the inadequacies in our banking sector,” the former central bank governor cautioned. Dr. Farashuddin was also critical about the reform that was brought in the banking sector in the early 90s when all banks were permitted to provide long-term loans.
Remittance inflow rises by 16.56pc in 8 months
Expatriate Bangla-deshis sent US $9,461.15 million remittance in the first eight months of the current fiscal 2017-18, which is 16.56 per cent higher than the amount received in the corresponding period of the preceding fiscal, reports BSS. According to Bangladesh Bank (BB), the country received $8,117.07 million remittance during July-February period of 2016-17 financial year. “The flow of remittances into the country rebounded in the current fiscal 2017-18 as BB took some measures to streamline the legal channel for encouraging the Non-Resident Bangladeshis (NRBs) to send home money,” BB Deputy Governor Abu Hena Mohammad Razee Hassan told the news agency yesterday. He said the recent flow of remittance indicates that it is gradually increasing and this trend is likely to continue in the upcoming months. According to the BB data, the country received $1,149 million in February, $1,379.79 million in January, $1,163.82 million in December, $1,214.75 million in November, $1162.77 million in October, $856.87 million in September, $1,418.58 million in August and $1,115.57 million in July in 2017-18 fiscal.
Case against RCBC by April this year
Finance Minister AMA Muhith unveiled Sunday a government plan to sue Rizal Commercial Banking Corporation (RCBC) of the Philippines by April to recover the reserves stolen through cyber-heist. He said the CID (criminal investigation department) has been asked to submit its investigation report as soon as possible to file the case in a New York court, as the money was taken away from Bangladesh’s account with the US Federal Reserve Bank in that city. An American law firm will be hired to deal with the case and Bangladeshi lawyers will also assist them, he told newsmen after an inter-ministerial meeting on this issue at Bangladesh secretariat. Asked whether the Federal Reserve Bank of New York agreed to be a party in this case with Bangladesh, Mr Muhith said Bangladesh Bank governor Fazle Kabir will discuss the issue with them. However, meeting sources said the CID may not be able to submit its investigation report by April, thus filing the case may get delayed. Bangladesh has the scope to file criminal case against RCBC until February 2019, according to officials.
New ED of BB
Mr. Sheikh Mozaffar Hossain has been promoted to the post of Executive Director of Bangladesh Bank. He joined Bangladesh Bank in 1988 as an Assistant Director. During his long career, he performed in various departments of Bangladesh Bank including Agricultural Credit, Foreign Exchange Policy and Financial Institutions, Monetary Policy and Banking Inspection. Mr. Hossain has a MSS Degree with Honours in Economics from the University of Dhaka. He also has a Masters Degree in General Economics from the Eastern Michigan University of USA and a Diploma in project Financing from ITC, ILO, Italy.
Rising up to face new challenges in banking
Several newer risks, growing financial crimes, and several chaotic incidences and corporate scandals have brought fresher challenges for human resource management in banks in global context. For quite some time now, the global financial world has been dogged by greater risk-taking followed by disastrous corporate scandals, market crashes, frauds and embezzlement schemes, and financial crimes, all of which together represent a set of fresh challenges for those working in the banking industry. Banks are thus having to adjust to novel and increasingly complex problems that have far reaching and long-lasting consequences in the incredibly interconnected global financial system. Often, these new set of problems require a correspondingly advanced and specialized set of skills and human resources. As business strategies of banks have undergone major changes, talent strategies must also change accordingly. The expectations for senior leadership in banks have changed drastically as banks are looking for leaders to handle issues about how the business interacts with customers rather than product innovation. The shifting scenario brings several challenges for human resources (HR) in banking. Especially, challenges in the form of regulatory compliance, right remuneration, and development of efficient and ethical leadership are particularly critical in a scenario with struggling corporate governance in several economies of the globe including Bangladesh.
Chinese consortium agrees to go by binding Bangladesh rules
The bid-winning Chinese consortium agreed to exclude and relax their conditions set to be strategic partner of Dhaka Stock Exchange (DSE), trying to address a few issues. Having received consent from the Chinese consortium, comprising Shenzhen Stock Exchange and Shanghai Stock Exchange, the premier bourse of Bangladesh sent Sunday the clarification of the sticking points to the securities regulator. DSE sources said the Chinese consortium has agreed to sign share-purchase agreement as per the law of Bangladesh. The consortium earlier had proposed to conclude the agreement as per the UK law. But the arbitration of any dispute, if arises, will be conducted as per international arbitration rules of the UK. The Chinese proposal said it could appoint anyone to the DSE board notwithstanding whatever the articles of association state. The highest bidder had set a condition of taking its approval regarding decision on more than 15 % of any current asset and inclusion of any strategic partner. The Chinese bidder had also included the condition of taking its approval for any single and joint investment worth above BDT 100 million. In this case, it has increased the investment limit up to BDT 1.0 billion. It has also increased the limit of taking loans worth above BDT 1.0 billion from BDT 100 million to be taken as per the approval of Chinese consortium.
Think-tank suggests steps to contain inflation
Bangladesh has hit an enormous current account deficit, highest in a decade. Unnayan Onneshan (UO), an independent think-tank, said this on Sunday attributing this current account deficit to huge increase in import payment together with low export growth amid no possibility of revival of the generalized system of preferences (GSP), reports UNB. In its monthly publication of the ‘Bangladesh Economic Update’ for February 2018, the think-tank also feared that the recent hike in oil price and high import of consumer goods are likely to result in an upsurge of food inflation, adversely affecting the standard of living of the low-income people. Taking the rising trend in inflation and recent upsurge in oil price into consideration, it projected that food inflation is likely to hit 8.34 % at the end of the current fiscal year in the absence of immediate price stabilization measures. Calling for the expansion of country’s productive capacities that enhance utilization of available resources through efficient entrepreneurial capabilities and increased production linkages, it recommends adoption of measures to stabilize price in the short run and strategies to foster employment augmenting growth in the long run.
BGMEA, BKMEA yet to finish workers’ database
Both the apparel apex trade-bodies – BGMEA and BKMEA – are yet to complete preparing a biometric database of the workers under their respective member factories, keeping the actual number of readymade garment (RMG) sector workers in the dark as ever. Till date, some 2.95 million workers of some 2,136 member factories of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have been enlisted. On the other hand, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) has been able to enlist the workers of only 147 of its member factories so far, out of active 900 units, in its database. It is estimated that some 4.4 million workers, majority of whom are women, are employed in the RMG sector, although there is no specific data on the number of male and female workers or their ratio.
Vietnam-BD Business Forum tomorrow
Vietnamese entrepreneurs will be invited to invest in some potential sectors, like energy, agriculture and IT, during the Vietnam-Bangladesh Business Forum to be held in the capital tomorrow (Tuesday). “We will urge Vietnamese investors to invest in IT, energy, agriculture and other sectors for mutual benefits of the two countries,” Md Shafiul Islam (Mohiuddin), President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), told the media at a city hotel on Sunday. “Vietnam is more advanced in the information technology (IT), agriculture, energy, steel and other sectors. We can explore the opportunities to collaborate with Vietnam for our mutual benefits,” he said. The Vietnamese entrepreneurs could invest in Bangladesh in the agro and food processing, infrastructure, IT and telecommunications and energy sectors under joint venture, he added. “They could also transfer technology to Bangladesh for the development of these sectors.” Vietnamese President Tran Dai Quang will be the keynote speaker at the business forum, said the FBCCI chief. The Vietnamese president along with an entourage of around 100 dignitaries, including 42 representatives of trade bodies, arrived in Dhaka on Sunday, seeking to consolidate bilateral relations and explore business potentials.
Bangladesh to seek more Vietnamese investment
Bangladeshi businesses will seek more investment from Vietnam during the visit of the Southeast Asian country’s President Tran Dai Quang, who arrived in Dhaka yesterday. The bilateral trade volume is in favour of Vietnam, from where Bangladesh has been importing woven fabrics in bulk quantity since 2011 after the relaxation of the Rules of Origin by the EU for the least developed countries. The European Union started giving the zero-duty benefit to the exporters of apparels, including the ones made of imported fabrics. “We will ask for Vietnamese investment here so that the trade balance can be narrowed down at least to some extent,” said Shafiul Islam Mohiuddin, president of the FBCCI. Still, Bangladesh will have to meet 65 percent of its demand for woven fabrics from imports because of a weak local backward linkage industry.
Chinese mobile brands growing rapidly
Chinese mobile phone brands are building up their presence in Bangladesh, doubling their share within a year. In 2017, Chinese brands accounted for 22 percent of the smartphones imported, up from 12 percent a year earlier, according to local importers. All the global leading Chinese brands such as Huawei, Oppo, Xiaomi, Tecno, and Vivo are doing business in Bangladesh and have gained much popularity. The brands’ import more than doubled to 39.40 lakh units in 2017 from a year earlier, whereas the overall market grew only 11 percent to 3.44 crore, according to data collected by the top importers of the country. The growth is even higher in case of basic phones: imports by Chinese brands surged 117 percent year-on-year to 21.68 lakh units last year.
Robi pays Tk 10cr out of Tk 18.72cr
Robi-Axiata, the second largest mobile operator of the country, yesterday paid Tk 10 crore VAT out of Tk18.72 crore to NBR, the mobile operator evaded in VAT, NBR officials said. “Robi, under fire from the National Board of Revenue (NBR), has paid Tk 10 crore along with the invoice at the NBR office at noon. The rest of the amount will be paid soon,” Badruzzaman Munshi, assistant commissioner of NBR, told The Independent yesterday. Robi was facing freezing of its bank accounts, has paid due Value Added Tax (VAT) of Tk 18.72 crore, which it earlier had evaded, he added. The Independent contacted Robi yesterday to get its comment about the matter but despite several attempts, the spokesperson of the telecom operator Ekram Kabir did not respond. Earlier, upon getting that assurance from Robi, the country’s second largest telecom operator, NBR on Thursday withdrew its order of freezing all of Robi’s bank accounts.
Dhaka wins S Asia Procurement Innovation Award
The Roads and Highways Department of the Road Transport and Bridges Ministry of Bangladesh won South Asia Procurement Innovation Award in the fifth South Asia Regional Public Procurement Conference in New Delhi recently. Besides Bangladesh, Afghanistan, India, Pakistan, Bhutan, Maldives, Nepal and Sri Lanka also won awards in the conference. A case story, submitted by Kazi Sayeda Momtaz, Computer System Analyst of the Roads and Highways Department (RHD), won the prestigious award, says a statement.
Formalities delay rice OMS resumption
The government could not resume its open market sales of rice in Dhaka and most other places in the country on Sunday as it could not complete necessary formalities. The government on Thursday had announced resumption of the OMS from Sunday as rice prices leaped by one per cent to three per cent depending on verities over last month.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 61.48||↑0.23||↑0.38%|
|Crude Oil (Brent)||$ 64.62||↑0.25||↑0.39%|
|Gold Spot||$ 1,325.72||↑2.97||↑0.22%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 83.23|
|GBP 1||BDT 114.77|
|EUR 1||BDT 102.56|
|INR 1||BDT 1.28|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.