TT-Clean: 77.1 | TK BC-Selling: 78.1
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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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Important Business News Extracts March 18, 2018

NPLs swell 19.51pc in 2017

The volume of non-performing loans (NPLs) in the country’s banking system jumped 19.51 per cent or Tk 121.31 billion in the last calendar year (2017) despite close monitoring of the central bank. The NPLs rose to Tk 743.03 billion as on December 31 last year, from Tk 621.72 billion on the same day of the previous year (2016), according to Bangladesh Bank’s (BB) latest statistics. It was Tk 513.71 billion as on December 31, 2015. Officials of the central bank, however, said stronger recovery drives by the commercial banks and rescheduling of loans pushed down the NPLs in the final quarter (Q4) of the last calendar year.


Farm sector sees slight fall in classified loans

Classified loans in the agriculture sector declined slightly in the seven months to January last as banks strengthened recovery drives, officials said. The amount of non-performing loans (NPLs) made to farmers dropped by 0.22 per cent to Tk 52.72 billion (5272 crore) during the July-January period of the fiscal year (FY) 2017-18 from Tk 52.84 billion in the corresponding period of last fiscal. “The volume of default loans in the agriculture sector fell slightly during the period under review mainly due to expedited recovery drives by the scheduled banks,” a senior official at the Bangladesh Bank (BB) told the FE. The share of NPLs in the total outstanding loans in the agriculture sector fell to 13.06 cent in the first seven months of this fiscal from 14.52 per cent in the same period of the FY 17.

Source: http://today.thefinancialexpress.com.bd/public/trade-market/farm-sector-sees-slight-fall-in-classified-loans-1521217762

Depositors now easy targets of govt, banks

The government is now milking the bank depositors to the maximum possible extent to extract tax revenues, at times, going beyond logic and norms. The depositors are being made to pay tax revenue in addition to fees and service charges levied by the banks on them on a regular basis. Depositors find little incentive to keep money with the banks after all the deductions from their interest income, if there is any. The recent decline in interest rates on deposits has put them in a further disadvantageous position. That is why there has been a rush for investment in the government’s savings tools instead of going to the banks for the last couple of years, a banking industry insider said.

Source: http://today.thefinancialexpress.com.bd/first-page/depositors-now-easy-targets-of-govt-banks-1521304866

Banks’ deposit rates on the rise amid liquidity crisis

Rate of interest on deposits in a number of banks increased up to 12.05 per cent in March this year amid liquidity crisis in the sector, raising concern among businesses about increased cost of doing business. Businesses have said that such trend of deposit rate would ultimately lead to an increased lending rate by the banks. On the other hand, rise in lending rate will hamper investment plan and many may rethink making investments in the context of high lending rate, they fear. South Bangla Agriculture and Commerce Bank Limited increased triple benefit scheme’s interest rate to 12.05 per cent and the rate was effective since February 11. The new generation bank was also offering 12 per cent interest under its double benefit scheme. Besides, Farmers Bank Limited was offering 12 per cent interest to its customers against a monthly saving scheme for three-ten years, while the entity was also offering 11.25 per cent interest against monthly saving scheme for above three years. NRB Global Bank, another new generation bank, was also offering 11 per cent under its double pension scheme.

Source: http://www.newagebd.net/article/36915/banks-deposit-rates-on-the-rise-amid-liquidity-crisis

Average inter-bank transaction volume declines to USD 103.00m

Local foreign exchange market remained calm in the week ended Thursday. Bangladesh Bank kept the exchange rate of the dollar to BDT 82.96. The BB continued selling dollars into the market. The average daily inter-bank USD-BDT transaction volume was about USD 103.00 million against USD 123.21 million of the preceding week.

Source: http://today.thefinancialexpress.com.bd/stock-corporate/average-inter-bank-transaction-volume-declines-to-10300m-1521217390?date=17-03-2018

Export earnings from RMG increases 8.3%

Export earnings from the Readymade Garment (RMG) increased by 8.3 % or USD 584.87 million in October to December quarter of 2017, compared to the corresponding quarter of previous year 2016, reports BSS. According to BB data, export earnings from RMG stood at USD 7,628.67 million during the October to December quarter of 2017 which was USD 7,043.8 million in the same quarter of 2016. RMG is the major export item, which was 82.4 % of the country’s total export earnings of USD 9253.29 million in the October to December quarter.

Source: http://today.thefinancialexpress.com.bd/trade-market/export-earnings-from-rmg-increases-83pc-1521137374?date=16-03-2018

Sinking new banks desperate for deposits

A number of new banks are desperately striving to collect deposits by offering attractive rewards like jobs. But due to scams in some of these banks people have lost confidence in all of these financial institutions. A public relations officer of a fourth generation public bank urged this correspondent to find any known person, who is interested in depositing Tk5 crore in his bank for which the bank in turn is ready to recruit two persons who recommend depositors as a reward against the deposit. Visiting another bank, this correspondent talked with a cashier, who was given a target by his bank to collect Tk10 lakh deposit by March, though that is not among the cashier’s responsibilities. According to sources, nine new banks — Meghna Bank, Midland Bank, Modhumoti Bank, NRB Bank, NRB Commercial Bank, NRB Global Bank, South Bangla Agriculture and Commerce Bank, The Farmers Bank and Union Bank — are suffering the most in collecting deposits. These banks are facing problems due to scams in two of the fourth generation banks — The Farmers Bank and NRB Commercial Bank.

Source: http://www.dhakatribune.com/business/2018/03/17/sinking-new-banks-desperate-deposits/

Shurwid yet to pay BDT 13cr to NRB Bank, United Finance

New management of Shurwid Industries Ltd after the takeover of the company by Eurodesh Consumers Products has so far failed to pay loans amounting to around BDT 130 million to NRB Bank and United Finance. As per an agreement between the new management and the former management of the company signed on August 5 last year, all the dues, debts and liabilities of Shurwid, as per updated company’s records including NRB Bank and United Finance loans, will be taken over by the new management.

Source: http://www.newagebd.net/article/36917/shurwid-yet-to-pay-BDT-13cr-to-nrb-bank-united-finance

Non-bank depositors to get insurance coverage

Bangladesh Bank has prepared a draft law bringing amendments to an existing one to ensure insurance coverage for depositors of non-bank financial institutions (NBFIs) to protect their interests. Currently, only bank depositors are eligible for insurance based on The Bank Deposit Insurance Act, 2000. The amendments have been proposed on it. The draft Deposit Protection Act, 2017 will be sent to the finance ministry once stakeholders’ opinions are taken, said a senior BB executive. The central bank took the initiative as deposits in leasing companies are growing fast due to their high interest rates, he said. Deposits in the country’s 29 NBFIs stood at Tk 46,797 crore as of December last year while their loan portfolio amounted to Tk 61,456 crore, central bank data shows. According to the draft act, depositors will get insurance coverage for up to Tk 1 lakh if the respective NBFI goes for liquidation. Therefore, those having deposits of Tk 1 lakh or less will get back the whole amount while those having more will just get Tk 1 lakh. It goes the same for bank depositors.

Source: http://www.thedailystar.net/business/non-bank-depositors-get-insurance-coverage-1549801

BB asks Sonali to shutter its US exchange house

Bangladesh Bank has asked Sonali Bank to bring down the curtain on its loss-making exchange house in the US, which is yet to turn in any profits consistently despite injection of a total of $28 million since 1994. With a view to facilitating remittance, the state-run lender had set up the Sonali Exchange Company Incorporation (SECI) 24 years ago with an initial capital of $250,000. It was gradually raised to $950,000. Since its inception, SECI has repatriated profit of only $100,000. Between 1994 and 2016, its cumulative profit stood at $293,000. Between 1995 and 2010, Sonali provided long-term loans of $1.85 million to the SECI at 5 percent interest. The exchange house has repaid $600,000, meaning its overall liabilities stand at $1.25 million, as per Sonali. But the central bank found that the state-run bank did not count any interest on its loans to SECI, which is a violation of the terms of the loan that the BB had signed off on. The annual report of SECI for 2013 showed that the exchange house had earlier issued promissory note against the loans — at zero percent interest.

Source: http://www.thedailystar.net/business/bb-asks-sonali-shutter-its-us-exchange-house-1549804

Govt rethinks tax rebate on savings tools

The government rethinks the continuation of tax rebate facility against investment in savings tools as a section of people are allegedly misusing such opportunity, officials said. The National Board of Revenue (NBR) has been asked to review the impact of tax rebate facility, taking into consideration the government’s cash management risk, they added. “Some people invest in savings tools in the month of June and encash those after submission of tax returns to avail of tax rebate facility,” a recent meeting of the cash and debt management committee (CDMC) was told. Finance secretary in-charge Mohammad Muslim Chowdhury chaired the meeting at the ministry of finance which termed it a “bad practice” and asked the NBR to take steps for making it rational. The meeting was told that the return from investment in savings tools is almost 5-6 per cent higher than the interest rate offered on money deposited with commercial banks. As a result, people tend to invest in savings tools and thus the government’s borrowing from non-bank sources is increasing day by day.

Source: http://today.thefinancialexpress.com.bd/public/first-page/govt-rethinks-tax-rebate-on-savings-tools-1521222655

BSEC body reports back on Chinese Consortium offer

The appraisal committee of the securities regulator submitted on Thursday its report on the Chinese Consortium’s proposal to be a strategic partner of the premier bourse DSE. A four-member committee of the Bangladesh Securities and Exchange Commission (BSEC) submitted the report to the commission after looking into the Chinese Consortium’s proposal. “The committee has submitted its report and now the regulator will take the final decision regarding accepting or rejecting the Chinese Consortium as strategic partner of the Dhaka Stock Exchange (DSE),” a BSEC official said. An informed source said the interest of the DSE could have been underestimated, if the appraisal body did not look into the factors going against the existing rules and regulations. “The exchange’s interest has been secured after the regulatory committee addressed the issues and subsequently the Chinese Consortium excluded the contradictory conditions from its proposal,” the source said. It said the appraisal committee found the exchange’s negligence in securing the interest of the premier bourse. The source also said following the regulatory query, the DSE submitted its explanation to the BSEC stating that the Chinese Consortium excluded the contradictory conditions from its proposal.

Source: http://today.thefinancialexpress.com.bd/public/first-page/bsec-body-reports-back-on-chinese-consortium-offer-1521135342

Lower spending likely to narrow deficit

The country’s budget deficit likely to remain below the level projected for the current financial year (FY) 2017-18 due to less-than-expected development and revenue spending. The budget deficit in the six months to December 2017 was Tk 62.77 billion while it was Tk 64.44 billion during the same period a year back, according to a report prepared by the finance ministry. Total expenses during the period under review were Tk 945.00 billion while revenue mobilisation was Tk 882.03 billion. External assistance coupled with domestic borrowing was used to meet the resource gap. Development expenditure during the July-December period was Tk 214.60 billion, down by more than 4.5 per cent than the same period in the last fiscal year. Similarly, revenue expenditure during the first half of the current fiscal year was Tk 688 billion as against Tk 692 billion during the corresponding period of the previous fiscal year. People at the Finance Division told the FE that there was less-than-expected level of spending on both development and non-development.

Source: http://today.thefinancialexpress.com.bd/public/first-page/lower-spending-likely-to-narrow-deficit-1521222469

NBR asks intelligence wing to intensify vigilance

The National Board of Revenue (NBR) has asked its Investigation and Intelligence Cell (IIC), formed in each tax zone, to strengthen their vigilance and scrutiny to prevent tax evasion, reports UNB. “As part of the drive to catch the tax evaders, the NBR has asked the IIC to take effective steps in this regard,” a senior official at the NBR told the news agency. Recently, the NBR has given the directive to its field level officials as the first half of the current fiscal has already elapsed. The NBR has asked the officials to audit the big taxpayers’ files properly. “They’ll send fortnightly reports to the Board on their activities,” the NBR official said.


NBR invites trouble after doctoring tax collection data

The National Board of Revenue (NBR) has run into trouble of setting increased tax collection target after “intentionally” cooking up last fiscal’s receipt, people familiar with the situation said. The board’s tax collection growth target for the current fiscal year (FY 2017-18) shot up from the projected 35 per cent to 45 per cent, given the last fiscal’s revenue collection Tk 1.85 trillion. Last fiscal’s tax collection data compiled by the NBR and Controller General of Accounts (CGA) office showed a gap of Tk 135 billion, according to officials. The revenue board said the government’s tax receipt was Tk 1.85 trillion in FY 2016-17, but the accounts office found the actual collection to be Tk 1.71 trillion. The gap is 7.30 per cent of the revenue collection data, which the tax-collecting authority reported to the government showing an achievement in the revised target of revenue receipt. The people familiar with the situation said that as revenue collection reflects the performance of the taxmen, some of the board offices “intentionally” doctored revenue collection figures with the help of large taxpayers.


ADB seeks NOC to invest $120m in power sector

The Asian Development Bank (ADB) has sought clearance from the government to invest US$120 million under a private initiative in Bangladesh’s power sector that struggles to serve an insatiable demand. Sources said the foreign development financier made the move as private-sector conglomerate Summit Power tries to tap global equity through listing on Singapore stock-market. The independent power producer has formed Summit Power International (SPI) as a Singapore-based holding company for netting in funds from abroad by divesting its shares on Singapore Exchange Ltd (SGX) because of Bangladesh’s stock-market being a small one. “ADB proposed to invest in SPI on the basis that the proceeds of ADB’s investment will be utilised for energy-sector projects in Bangladesh,” ADB country director Manmohan Parkash wrote in a recent letter to the Economic Relations Division (ERD). The ADB-proposed investment falls under its non-sovereign operations, according to the letter figuring out the modalities of investment.

Source: http://today.thefinancialexpress.com.bd/first-page/adb-seeks-noc-to-invest-120m-in-power-sector-1521305023

Projects, future funding in focus

An annual Bangladesh-France consultation-2018 will be held in Dhaka on March 28-29 to review the implementation of the existing France-funded projects as well as possible future funding, officials said. The two-day 3rd annual consultation meeting (ACM) is aimed at discussing the opportunities for bilateral cooperation relating to future development plan of Bangladesh and reviewing the progress of the Agence Française de Development’s (AFD) finance for the ongoing and pipeline projects in Bangladesh. “High officials of Economic Relations Division (ERD) and representatives of the ministries concerned will attend the upcoming meeting,” an ERD official told the FE. The consultation will take place at the National Economic Council (NEC) at the city’s Sher-e-Bangla Nagar. Eight members of AFD will also attend the meeting.

Source: http://today.thefinancialexpress.com.bd/trade-market/projects-future-funding-in-focus-1521301518

Dutch govt ready to invest in Ctg projects

The Dutch government is ready to help mitigate the waterlogging problem in Chittagong and also assist in garbage management and building sanitation facilities. Head of Economic Affairs and Development Cooperation of the Embassy of the Netherlands in Dhaka Jeroen Steeghs stated the readiness at a meeting with the directors of Chittagong Chamber of Commerce and Industry on Thursday. He visited the CCCI at the World Trade Centre in the city and had discussion with CCCI President Mahbubul Alam and Vice President Syed Jamal Ahmed on the bilateral issues and spheres of cooperation between Bangladesh and the Netherlands.

Source: http://today.thefinancialexpress.com.bd/trade-market/dutch-govt-ready-to-invest-in-ctg-projects-1521301495

‘Greater Korean FDI inflow could be a game-changer for Bangladesh’: Bangladesh Ambassador to South Korea

Bangladesh Ambassador to South Korea Abida Islam has said an enhanced inflow of Korean Foreign Direct Investment (FDI) could be a game-changer for Bangladesh’s industrial development. Korean Tech-giant Samsung and LG, the Ambassador said, are going to manufacture its products in Bangladesh under a joint venture company within a short time which may reduce the trade deficit between the two countries. Bangladesh is offering hundreds of acres of lands to the South Korean investors for setting up a South Korean EPZ in Mirsarai, Chittagong or Moheshkhali, Cox’s Bazar. Some Korean companies have expressed their interest to invest in Special Economic Zones in Bangladesh, while many others have expressed interest to invest in the country.

Source: http://www.dhakatribune.com/business/2018/03/17/greater-korean-fdi-inflow-game-changer-bangladesh/

India to provide USD 1.0b for building transmission grid

The government will build a transmission grid for electricity distribution from Rooppur nuclear power plant under a USD 1.41 billion project, mostly financed from an Indian credit line. Officials said Friday the highest amount of funds, nearly USD 1.0 billion, would be spent from the latest Indian Line of Credit (LoC) worth USD 4.5 billion on this project. They said the Power Grid Company of Bangladesh (PGCB) has already taken up the project for installing the transmission grid for evacuating electricity from the under-construction nuclear power plant. The first 1200MW unit of the plant is expected to commence in October 2022 and another planned 1200MW unit by 2024. Besides, 60km-long 230kv transmission line from Rooppur-Baghabari will also be set up under the project.

Source: http://today.thefinancialexpress.com.bd/last-page/india-to-provide-10b-for-building-transmission-grid-1521223031?date=17-03-2018

Alliance completes 88pc garment factory remediation work

Some 88 per cent of the factory remediation work has been complete across all active garment factories in the country as the Alliance continues its efforts to improve safety of workers in the country’s readymade garment (RMG) sector, its Executive Director Jim Moriarty said on Thursday. “As of Thursday, 322 Alliance-affiliated factories have completed all material components in their corrective action plans (CAPs) and are considered substantially remediated,” he said at a press conference at a city hotel. Alliance’s five-year term of jurisdiction ends in the middle of this year. About future regulators in the sector, he said, “The Alliance will transition our activities to a safety monitoring organisation managed by credible, trusted local partners by the end of this year.” This entity, in parallel with Remediation Coordination Cell (RCC), will continue to oversee factory inspections, monitoring and the Alliance’s highly successful helpline and training programmes, he added.

Source: http://today.thefinancialexpress.com.bd/public/trade-market/alliance-completes-88pc-garment-factory-remediation-work-1521136787

Thrust on tariff rationalisation for export diversification

Participants at a workshop on Thursday stressed the need for tariff rationalisation in order to effectively diversify the country’s export basket. The workshop titled ‘Tariff Modernisation for Export Diversification’ was jointly organised by the National Board of Revenue (NBR) and the World Bank Group in the city, according to a statement. NBR Chairman Md Mosharraf Hossain Bhuiyan inaugurated the workshop. NBR Member (Customs Policy and ICT) Md Firoz Shah Alam and BICF Programme Manager Dr M Masrur Reaz addressed the workshop. Dr Zaidi Sattar, Chairman, Policy Research Institute (PRI), gave a presentation highlighting the issues related to current tariff structure and a way forward for Bangladesh. Senior officials of NBR and PRI, representatives from DFID and World Bank Group joined the workshop.

Source: http://today.thefinancialexpress.com.bd/public/trade-market/thrust-on-tariff-rationalisation-for-export-diversification-1521136877

Rooftop solar power to meet energy demand at affordable price

The recent launch of International Solar Alliance (ISA) will help Bangladesh move quickly to scale up its use of renewable power, experts said. The launch of ISA aims to build a network to help tropical countries around the world boost their use of solar power. Bangladesh is blessed with ample sunshine round the year and this can help satisfy industries’ ever-increasing need for electricity and industrialists need to take a fresh look at their roofs. It requires only 100 Sq.ft. space and about Tk 75,000 to generate 1.0 KW of electricity. The unit cost of electricity from rooftop solar falls below Tk 8.0/unit and this is the opportunity the industrialists should utilise. According to the Bangladesh Energy Regulatory Commission, the flat rate of electricity for industries is Tk 8.20/unit and this is further subsidised by the Government of Bangladesh (GoB).

Source: http://today.thefinancialexpress.com.bd/trade-market/rooftop-solar-power-to-meet-energy-demand-at-affordable-price-1521301394

Now Bangladesh Telecommunication Regulatory Commission (BTRC) eyes 5G

Bangladesh Telecommunication Regulatory Commission (BTRC) is now mulling over going for most advanced 5G service as soon as possible, reports BSS. BTRC introduced fourth generation (4G) mobile phone service in the country last month. The telecom regulator has started thinking about running the ground work to adopt necessary policy and preparation to introduce the super-fast service without much delay.

Source: http://today.thefinancialexpress.com.bd/last-page/now-btrc-eyes-5g-1521136022?date=16-03-2018

Local and Global Stock Indices *

Index NameClose ValueValue ChangePercentage Change
Nikkei 22521,676.51↓127.44↓0.58%

World Commodities *

CommodityClose ValueValue ChangePercentage Change
Crude Oil (WTI)$ 62.34↑1.15↑1.88%
Crude Oil (Brent)$ 66.21↑1.09↑1.67%
Gold Spot $ 1,314.24↓1.86↓0.14%

Major Currencies Exchange Rates Movement in Last Seven Days *

Exchange Rates
USD 1BDT 83.22
GBP 1BDT 116.02
EUR 1BDT 102.27
INR 1BDT 1.28





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