Three banks adjust stock overexposure without selling shares
Bangladesh Bank has already provided policy support to three banks — AB Bank, Pubali Bank and Mercantile Bank — to streamline their capital market exposure without selling shares, an official of the central bank said. The support came after the BB’s announcement on April 28 that it would provide policy support to the banks which have overexposure to the capital market so that they (the banks) can bring down their investment in the market to the allowable limit by the July 21 deadline. The BB official told New Age that the capital market exposure of the three banks were brought down within the allowable limit by extending paid-up capital of their capital market subsidiaries. A BB circular issued in December last year excluded banks’ equity investment in their subsidiary companies from the calculation of the banks’ capital market exposure.
Government backtracks on floating euro-pound sterling bonds
The government is going to withhold a move to introduce premium and investment bonds in euro and pound sterling as it finds the new instruments unnecessary when adequate foreign currency is in hand, officials said. Four bonds were supposed to be launched by the National Savings Directorate. Of them two are euro premium bond and euro investment bond and the rest two are pound sterling premium bond and pound sterling investment bond. The Internal Resources Division (IRD) sought opinion recently from the Finance Division sending draft of rules of the proposed bonds. The Finance Division recently gave its opinion where it termed launching of the proposed bonds unnecessary. The Finance Division in this case referred opinion of central bank which suggested not to float any new bond now and for making treasury bill and bonds attractive to non-resident Bangladeshis (NRBs). The central bank in this case has taken into consideration the state of rate of interest of loans in international market, country’s foreign currency reserve, exchange rate of taka with foreign currencies, and comparing proposed bonds with marketable treasury securities.
Search body recommends 3 for deputy governor
A search committee, formed to look for candidates to replace two Bangladesh Bank deputy governors, on Sunday handed over the recommendation of three candidates for the post to the government. Search committee chairmen Qazi Kholiquzzaman disclosed it while talking to the journalists at the central bank and said ‘We recommended three out of twenty one candidates who have more capability for the post.’ Now the government will appoint the appropriate candidates after examining the recommendation, he added. Government formed a four-member search committee to recommend two deputy governors for Bangladesh Bank after the posts at the central bank fell vacant.
The Federation of Bangladesh Chambers of Commerce and Industry turns to Prime Minister for resolving tensions over the enforcement of new VAT law
Country’s apex trade body has sought the prime minister’s intervention to resolve raging tensions over the move on the part of the Ministry of Finance to enforce a new law that would levy a blanket rate of 15% VAT on businesses. The business community aired the fear of escalation in prices of products and adverse effect on small and medium enterprises if the government enforced the Value Added Tax (VAT) and Supplementary Duty Act 2012. The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) President, Abdul Matlub Ahmad, sounded such forewarning in a letter sent Saturday to Prime Minister Sheikh Hasina. He regretted that the law the enforcement of which delayed deliberately was going to be pushed through without amendment following recommendations made by a joint consultative committee. “The country’s economic development might face a blow if the law is enforced without bringing necessary amendments to it. Also, some vested quarters may try to create political instability taking advantage of the agitation by small and medium businessmen over the VAT law,” the letter reads.
New budget to focus on growth, local investment
The government is going to increase the total outlay of upcoming budget by 17.69% from the current budget to about BDT 3,520.0 billion, said a top official. “The outlay of expenditure in next fiscal year will be increased to BDT 3,520.0 billion from the current budget of BDT 3,400.0 billion,” Senior Finance Secretary Mahbub Ahmed told the Dhaka Tribune. He said: “We are preparing the FY2016-17 budget giving major focus on growth, development and equal distribution of growth.” Finance secretary said the highest allocation in the upcoming budget will go to education sector, followed by health sector and manpower development sector. “The government will take several development projects in the budget for skill development of low-level workers and enhancing managerial skills of officials,” Mahbub Ahmed said.
Court grants more time for Robi-Airtel merger
The High Court yesterday gave the government three more weeks to submit its recommendations on the proposed merger between Robi and Airtel. The order comes after the telecom division sought more time to submit its recommendations. This is the fifth time that the government has got time extension from the HC for submitting its opinions on the proposed merger, which will create the country’s second largest telecom operator. The next hearing on the matter will be on June 6, said Barrister Tanjib-ul-Alam, a lawyer for the two operators. The recommendations will be sent to Prime Minister Sheikh Hasina for her approval before forwarding them to court. One of the recommendations that the ministry is preparing is an additional payment of BDT 7.0 billion as spectrum fees from the merged entity to adjust the spectrum price of Airtel.
Compensation for call drops from next month
Mobile phone subscribers will get a free minute for each call drop as compensation from next month if they experience the disruption more than once a day. The decision came yesterday in a joint meeting of the telecom division, telecom regulator and mobile phone operators at the secretariat. In January, Bangladesh Telecommunication Regulatory Commission made compensation for call drops mandatory. However, operators ignored the issue and sent letters to the BTRC, asking for more discussion on call drops.
World Stock and Commodities
|Index Name||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)*||$46.82||+0.61||+1.32%|
|Crude Oil (Brent)*||$48.43||+0.6||+1.25%|
|Dow Jones Industrial Average||17,535.32||(185.18)||(1.04%)|
|USD 1||BDT 78.38*|
|GBP 1||BDT 112.61*|
|EUR 1||BDT 88.63*|
|INR 1||BDT 1.17*|
*Currencies and Commodities are taken from Bloomberg.