Taka weakens against dollar, substantially
The Bangladesh Taka (BDT) has fallen considerably against the US dollar as the demand for the greenback grew to meet import payment requirements. The local currency weakened by 50 poisha in a single day in the inter-bank foreign exchange (forex) market on Tuesday, according to traders. The US dollar was quoted at Tk 83.60 each in the inter-bank forex market on the day against Tk 83.10 of the previous working day, they said. “Such depreciation may help bring dynamism to the inter-bank market, which was almost non-functional in the last 10 months,” a senior official of the Bangladesh Bank (BB) told the FE. There were limited transactions in the inter-market spot market in recent months. He also said the depreciation would not affect the prices of importable commodities directly in the market.
Bangladesh Bank sells $2.04bn to banks
The central bank of Bangladesh has so far sold more than $2.0 billion in the current fiscal year (FY) to the commercial banks directly to meet the growing demand for the greenback in the market. The Bangladesh Bank (BB), the country’s central bank, has continued its foreign currency support to the banks help those meet import payment obligations particularly for food grains, fuel and capital machinery. As part of the move, the BB sold $24 million to seven commercial banks on Tuesday to meet the growing demand for the greenback in the market.
Current account deficit records steep rise on higher imports: Crosses $7.0b in nine months of FY ‘18
The country’s current account deficit widened, reaching a record high in the first nine months of the current fiscal year (FY) as imports grew faster than exports. Central bank statistics, released on Tuesday, showed that the current account deficit hit $7.08 billion in July-March period of the fiscal 2018. The amount of deficit is the highest in the country’s history, which was only $1.37 billion in the same period of the past fiscal year. The increasing gap in both the merchandise and service trades of the country is pushing the current account deficit higher. The Bangladesh Bank data showed that the country’s merchandise trade gap with the rest of the world exceeded $13 billion in the first nine months of the current fiscal year. The deficit in merchandise trade stood at $13.20 billion in July-March period of FY18, which was $7.04 billion in the same period of the past fiscal year. Trade deficit registered an 87.5 per cent growth in the nine months to March. The Bangladesh Bank said that exports have recorded around 7.0 per cent growth in the first nine months of the current fiscal year, while imports surged by 24.50 per cent in the same period. The considerable jump in imports over the moderate increase in exports has driven up the trade gap.
A new ray of hope for SMEs: They may be allowed to raise funds from capital market
The Chinese consortium will work to create an SME-based board in the Dhaka Stock Exchange so that small entrepreneurs get the opportunity to raise fund from the capital market. “It will help to boost the SMEs as well as the capital market,” said Wang Jianjun, president and chief executive officer of Shenzhen Stock Exchange (SZSE). The consortium of SZSE and Shanghai Stock Exchange will emphasise innovation and product diversification so that investors can get a variety of options to put their money in. Wang’s comments came yesterday on a roundtable styled ‘Bangladesh-China capital markets’, jointly organised by the Policy Research Institute and the Chinese consortium at the capital’s Le Méridien hotel. Liu Fuzhong, a director of SZSE, hoped that SME-based board will foster the sector in Bangladesh like it did in China.
Credit-deposit mismatch worsens liquidity crisis: BIBM study finds
Mismatch between deposit and credit growth is causing the ongoing liquidity crisis to linger on, found a survey of the Bangladesh Institute of Bank Management (BIBM). Excess liquidity in the market also came down for this mismatch, revealed a report, “Treasury Operations of Banks 2017”, containing the survey. Professor Nehal Ahmed of BIBM presented the findings at a programme at the institute yesterday. Data shows that private sector credit growth was 18.1 percent in December last year while deposit growth was hovering around 10 to 11 percent. In 2015, credit growth was 12.7 percent against the deposit growth of 12.6 percent. The deposit growth rate was stable in 2015 and 2016 but declined in 2017. The growth rate was 13.1 percent in 2016 and 10.6 percent in 2017.
Dutch-Bangla Bank gets new DMD
Dutch-Bangla Bank has appointed a new deputy managing director on May 10. Shahidur Rahman Khan was earlier Southeast Bank’s senior executive vice president, says a press release. Attaining a master’s degree in business administration from the Institute of Business Administration, University of Dhaka, Khan has served in Islami Bank Bangladesh, National Bank of Pakistan, Social Islami Bank, Prime Bank and Southeast Bank.
bKash app launched
bKash, the country’s leading mobile financial service provider, has rolled out a mobile app to make transactions through the platform more simple and cost-effective. Through the app, bKash’s 3 crore users can send money, buy airtime, withdraw cash, make payment. Remittance service will be added in future. The MFS provider is offering discounts temporarily to popularise the app, which can be downloaded from the Google Play Store, said Kamal Quadir, chief executive officer of bKash. To make withdrawals using the app, the fee will be Tk 15 for Tk 1,000. The fee is Tk 18.50 when using the USSD (Unstructured Supplementary Service Data) channel. Moreover, person-to-person transaction through the bKash app is free. The charge is Tk 5 per transaction when using the USSD channel. The use of the mobile app will make transactions cheaper as bKash will not have to share 7 percent of its revenue with the mobile operators for using their service.
UCB signs MoU with Le Méridien
United Commercial Bank Limited (UCB) recently signed an MOU with Le Méridien Dhaka at the premises of the hotel, according to a statement. Under the MOU, UCB Platinum Credit Cardholders will enjoy ‘Buy One Get One Free’ buffet meal at “Latest Recipe” and “Olea” restaurant of Le Méridien Dhaka. Taufiq Hassan, Head of Retail Business of United Commercial Bank Limited and Anwar Hossain, Director of Sales and Marketing of Le Méridien Dhaka signed the MOU on behalf of their respective organisations.
LankaBangla Finance to issue BDT 3.0b bond
The board of directors of LankaBangla Finance has approved issuance of subordinated bond of BDT 3.0 billion, said an official disclosure on Tuesday. The non-bank financial institution is going to issue the subordinated bond to improve the capital base (Tier-II) of the company. The issuance of the bond is, however, still subject to compliance with relevant laws and regulatory approval like Bangladesh Bank and Bangladesh Securities and Exchange Commission (BSEC). The company also disclosed the first quarter (Q1) earnings results on Tuesday. As per Q1 financial statement, the company’s consolidated earnings per share (EPS) slumped more than 73% to BDT 0.16 for January-March 2018 quarter as against BDT 0.60 for January-March 2017.
Move to set up microfinance credit information bureau
A project taken up for establishing microfinance credit information bureau (MF-CIB) for the microfinance regulator is expected to be launched in June, an official said. To this effect, a memorandum of understanding (MoU) may be signed between Economic Relations Division (ERD) and UK’s Department for International Development (DFID) next month, he said. “The process of setting up the MF-CIB has already been formalised. Necessary steps are being taken in this regard,” Amalendu Mukherjee, executive vice-chairman of Microcredit Regulatory Authority (MRA), told the FE. Bangladesh Bank (BB) is developing software for the programme, he said.
Govt to allow inspection of DIFE in EPZs
The government has decided to bring factories in the country’s Export Processing Zones within the purview of the Department of Inspection for Factories and Establishments under the labour law. Against the backdrop of continuous pressure from the International Labour Organisation and the sustainability compact partners, the government has taken the move to allow labour inspection in conformity with the labour law in factories located in the EPZs.
Five RMG factories get Tk 40m from Accord Remediation Fund
The Accord Inactive Factory Remediation Fund has provided financial support worth Tk 40 million to five readymade garment factories for safety remediation work. The Fund was launched in February 2017 to support Accord-covered readymade garment (RMG) factories that no longer have any Accord company signatories as customers. The factories which have received financial support are: Hypoid Lingerie Ltd, Ritzy Apparels, Everbright Sweater Ltd, Ayesha Enterprise Ltd and Meek Knit Ltd.
Focus on organic products to grab share in $90b global mkt: Sector experts tell seminar
Businesses should focus on value-added organic products to get a sizeable share in the US$90 billion global green food market, sector experts said at a seminar on Tuesday. Considering the growing demand for organic foods and products, the government should also review its agricultural and commercial policies giving priority to green foods, they added. The Bangladesh Agro-based Product Producers and Merchants Association (BAPMA) in association with the help of Agro Products Business Promotion Council (APBPC) under the commerce ministry organised the seminar styled ‘Diversified Use of Agro Products and Value Addition at Global Standard Level in Bangladesh for Economic Benefits’ at the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) conference room in the city.
MJL Bangladesh Limited (MJL) goes for expansion
MJL Bangladesh Limited (MJL) has launched multi-compartment delivery truck for the first time in Bangladesh to deliver lubricating oil to its industrial customers, according to a recent statement issued by the company after disclosing the Q3 earnings for 2017-18. “Being the leading lubricant solution provider of Bangladesh, this shows our commitment towards providing efficiency-enhancing solutions to our customers,” M. Mukul Hossain, Chief Executive Officer of the company said. The company has signed an agreement for taking over 53 bighas of land including an industrial complex located at Murapara, Rupganj, Narayangonj with a total consideration value of BDT 970 million for its future expansion. The complex located near Shitalakshya river is equipped with gas connection with a draft of around 6 to 8 metres. The company has invested an amount of USD 9.375 million in its subsidiary, Omera Petroleum Limited (OPL) against issuance of right shares by OPL.
edotco to sell 30pc stake
Tower business company edotco Bangladesh is all set to sell 30% stake to local business group Getco as part of efforts to be eligible to get a tower sharing licence. The company is selling shares to comply with the tower sharing guideline, according to which the applicant of a tower sharing licence cannot keep a mobile operator as its shareholder and foreign ownership in the firm cannot exceed 70%. In edotco Bangladesh, Robi owns 19.99% stakes while the rest 80.01% belongs to edotco Group, a Malaysian telecom tower management company and a concern of Robi’s parent company Axiata Group. The tower business company will let go of all shares of Robi and 10.01% from the edotco Group, a top official of the company said. A highly placed source said edotco is paying Robi around USD120 million for the 19.99% shares and will pay Getco at the same rate. On April 1, the telecom regulator sought applications from the competent entities by May 13 to award four tower sharing licences. But Bangladesh Telecommu-nication Regulatory Commission (BTRC) had to extend the deadline by one more month, as none applied for the licence.
Labour law amendment key to GSP Plus: economist
The amendment to the labour law and its proper implementation is key for Bangladesh to achieving the “GSP Plus” benefit from the European Union following the country’s graduation to a developing nation, said an economist yesterday. The EU grants the generalised system of preferences plus trade privilege to developing countries if they fulfil four core conditions that deal with human rights, labour rights, environmental and governance issues. Besides, Bangladesh will have to ratify 27 core conventions of the International Labour Organisation if Bangladesh wants to be eligible for the tariff benefit. Bangladesh would have to raise its labour law to international standards and implement it properly to obtain the GSP plus status following its graduation from the least developed country category, said Khondaker Golam Moazzem, research director of the Centre for Policy Dialogue (CPD). The country is in advantageous position in regard to updating the labour law as the government is simultaneously working to meet the conditions of the Sustainability Compact, a US-provided Bangladesh Action Plan and the Sustainable Development Goals (SDGs).
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)||$ 71.10||↓0.21||↓0.29%|
|Crude Oil (Brent)||$ 78.26||↓0.17||↓0.17|
|Gold Spot||$ 1,293.51||↑2.98||↑0.23%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 84.20|
|GBP 1||BDT 113.64|
|EUR 1||BDT 99.58|
|INR 1||BDT 1.24|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.