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 May 25, 2016

Loan from saving instruments to increase in FY’17

The government’s loan from sale of saving instruments may increase over 33% in next fiscal year despite it being costlier than bank borrowing. This fiscal year too, the loan from saving instruments has already increased to BDT 280.0 billion exceeding the target of BDT 150.0 billion. According to Finance Division, the next fiscal year’s loan target from the sector may be set at BDT 200.0 billion with a 33.33% rise from the current fiscal’s. Finance Minister AMA Muhith recently approved the next fiscal year’s borrowing target from saving instruments with a consent from Prime Minister Sheikh Hasina. Finance Division officials said the government attempts to lower the amount of loan from saving instruments have failed as people’s response to it was more than expectation thanks to its higher profit rate. “The higher profit rate attracts more investors of saving instruments. While the average interest rate on fixed deposit in banks is 7.0%, the profit rate on saving instruments is 11.0%,” said a Finance Division official. Finance Division sources said there was huge pressure from owners of the commercial banks to reduce the profit rate of saving instruments as “most of people’s deposits are going to the government through the purchase of saving instruments. According to Bangladesh Bank data, the government sold BDT 230.24 billion of saving instruments between July and December, 2015. In the first nine months of the current fiscal year up to April 30, the government didn’t borrow any fund from the banking system although this is a less costly option of borrowing. From July 01 to April 30 this fiscal year, the government repaid BDT 124.68 billion compared to BDT 129.02 billion in the corresponding period of last fiscal year.


25 banks surpass annual farm loan disbursement target in 10 months

Farm loan disbursement by banks will surpass the target for the current fiscal year 2015-2016 as most banks, grappling with surplus liquidity, have injected heavily money in the agriculture sector in the first 10 months of the year. Out of a total of 56 banks, 25 banks exceeded the annual target of disbursing farm loan in 10 months of the current fiscal year. Bangladesh Bank set a farm loan disbursement target of BDT 164.0 billion for FY16 with a growth of 5.5% compared with the previous financial year FY15. But, in July-April of the FY16 banks disbursed BDT 141.28 billion in farm loans, which is 86.15% of the annual target. Besides, the growth in 10 months is 13.94-% compared to the same period of FY15 when banks disbursed BDT 123.99 billion. Although 14 banks disbursed below 60.0% of their annual targets in July-April, the rise in loan disbursement by other banks took the total disbursement to 86.15% of the annual target, said BB officials. BB data showed that among the banks which had crossed the annual target in 10 months, Habib Bank disbursed 500.0% (BDT 300.0 million) of the annual target of BDT 60 million in July-April, Citibank NA 254.18% of its target of BDT 170.0 million, The City Bank 206.03% of its target of BDT 1.8 billion, Eastern Bank 174.99% of its target of BDT 1.9 billion and Premier Bank disbursed 172.52% of BDT 1.10 billion. The officials said due to a sluggish trend in the industrial sector credit growth, the banks were trying to invest significant amount of fund in the government and the BB securities with an interest rate of 2-10%.

Source: http://newagebd.net/231726/25-banks-surpass-annual-farm-loan-disbursement-target-in-10-months/

BDT 9.72 billion investment in small, cottage units in Q3

A total of BDT 9.72 billion was invested in 7,305 small and cottage units under the state-run Bangladesh Small and Cottage Industries Corporation (BSCIC) during the July-March period of the current fiscal year (2015-2016), official sources said. It was 78.26% of the targeted investment of BDT 9.80 billion set earlier for the current fiscal year, according to official figures. Of the total, BDT 7.91 billion was invested in 2,396 small industrial units while BDT 1.81 billion in 4,909 cottage units during the first three quarters of the current fiscal. The targets for investment in small and cottage units were set at BDT 9.65 billion and BDT 143.20 million respectively for the fiscal year 2015-16. BSCIC sources said loans amounting to nearly BDT 1.61 billion were disbursed through banks and the Corporation among 4,861 entrepreneurs until March of the current fiscal year.

Source: http://print.thefinancialexpress-bd.com/2016/05/25/142349

Bangladesh secures BDT 5.17 billion in first loans from China-led AIIB

Bangladesh will get BDT 5.17 billion or USD 66.0 million in loans from the Asian Infrastructure Investment Bank for two power distribution projects — the first loan for the country from the China-led development bank. The projects at a total cost of BDT 8.21 billion were approved at a meeting of the Executive Committee of the National Economic Council (Ecnec) in Dhaka yesterday and will help improve the transmission lines of the country. Under the projects, Dhaka Electric Supply Company Ltd will upgrade two existing substations and install 33kV distribution lines underground in urban areas. The first project will upgrade grid substations and overhead distribution lines. It will cost BDT 5.69 billion, of which BDT 3.59 billion will come from the AIIB. Another project is for replacing the small inefficient transformers and air-insulated switchgear systems at Bashundhara and Uttara grid substations with larger efficient transformers and gas-insulated switchgear systems. The cost of the second project is BDT 2.51 billion, of which the AIIB will provide BDT 1.58 billion. The interest rate of the AIIB loan will be linked to the repayment period. It will be LIBOR plus 0.80% to 1.4%, said an official of the finance ministry. The repayment period will be eight years to 20 years.

Source: http://www.thedailystar.net/business/bangladesh-secures-BDT-517cr-first-loans-china-led-aiib-1229014

DSE to launch new book building software

Dhaka Stock Exchange will launch its own book building software tomorrow to upgrade the IPO system. The new book building software, developed by the DSE, will replace the existing ones provided by a Dubai-based software company Infotech, officials said. Book building is a process through which an issuer attempts to determine the price to offer for its security, based on demand from institutional investors. The price of an IPO (initial public offering) share is determined through automated bidding joined by different financial institutions. The shares are then opened for the IPO participants at the bidding cut-off price. Swapan Kumar Bala, a commissioner of Bangladesh Securities and Exchange Commission, will inaugurate the software on the DSE premises. The software will have some new characteristics which will give users some extra advantages and facilitate regulatory alterations, expansions, additions and reductions faster, DSE officials said. RAK Ceramics (Bangladesh) was the first company that used the book building system for its IPO in 2010. MJL Bangladesh and MI Cement Factory also used the mechanism for their IPOs in 2011. After that the method was suspended for a while and then revised by the regulator following the 2011’s market crash. United Power Generation and Distribution Company was the first company that applied the revised book building system last year. Now the system is mandatory for companies that intend to offer primary shares with premium prices to raise capital from the public. The stock market regulator last year made the book building mechanism mandatory for the premium seekers to ensure the accountability and responsibility of issuer companies, issue managers, auditors and other stakeholders.

Source: http://www.thedailystar.net/business/dse-launch-new-book-building-software-1229002

World Bank to give USD 176.06 million to boost agri productivity

The World Bank (WB) will provide Bangladesh with USD 176.06 million as assistance for increasing agricultural productivity and access to markets of more than one million poor farmers, particularly women. An agreement to this effect was signed between the government of Bangladesh and the WB Group at the NEC (National Economic Council) conference room Tuesday at Sher-e-Bangalnagar in the city. Senior Secretary of the Economic Relations Division Mohammad Mejbahuddin and the World Bank Country Director for Bangladesh, Bhutan and Nepal Qimiao Fan signed the agreement on behalf of their respective sides, said the WB press statement. The project will be implemented in 57 districts where it will benefit small-scale farmers through stronger linkages with research, agricultural extension services, farmer groups, and on-farm demonstrations to promote improved agricultural technologies, said the statement.


Government looks to keep inflation rate at 5.8% in next fiscal

Despite some risk factors, the government is likely to keep the inflation rate at 5.8% in the upcoming fiscal year (FY) 2016-17. The inflation target was estimated considering the existing prices of essential commodities including petroleum products in the global market, a senior official familiar with the budget preparations told the FE on Tuesday. Implementation of the pay scale for the government employees was seen as a risk factor, the official said, adding that it might create pressure on inflation in future. On the other hand, the inflation rate also fell to 5.61% during the period under review from 5.65% in March last on the point-to-point basis following the declining trend in both food and non-food items. “Point-to-point non-food CPI inflation decreased to 8.34% in April 2016 from 8.36% in March 2016, mainly on gross rent, fuel and lighting, furniture, household equipment and operation, medical care and health expenses, transport and communications, and miscellaneous goods and services,” the Bangladesh Bank (BB) said in a report on monthly inflationary trend, April 2016. The average inflation rate recorded in April 2016 was lower by 0.16% point than the annual target of 6.20%, set by the government in the national budget for the FY 16.However, core CPI inflation rose to 7.73% in April 2016 from 7.51% a month ago on the 12-month average basis, according to the BB report. On the other hand, the core CPI inflation came down to 8.87% in April last from 8.88% in March last on point-to-point basis.

Source: http://print.thefinancialexpress-bd.com/2016/05/25/142337

BGMEA for reintroduction of 10.0% special corporate tax

Leaders of the country’s apparel apex body — BGMEA — reiterated Tuesday its demand for reintroduction of 10.0% special corporate tax rate and reduction of tax at source to 0.30% in the next fiscal year. The demands came at a meeting between the National Board of Revenue (NBR) and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) at the latter’s headquarters in the city. NBR chairman Nojibur Rahman and BGMEA president Md Siddiqur Rahman, among others, spoke during the meeting. The meeting, first of its kind, was initiated by the NBR as part of its ‘partnership dialogue’ with the apparel sector leaders to be held in each quarter. The factory owners are investing a huge amount of money in carrying out remediation works and retrofitting according to the prescription of Accord, Alliance and National Action Plan to ensure workplace safety, Mr Rahman said after the meeting.


ECNEC approves BDT 69.50 billion projects

The Executive Committee of the National Economic Council (ECNEC) has approved six projects, including the Dhaka Water Supply Network Development one, involving a total of BDT 69.50 billion. The approval came at a meeting of the ECNEC held in the city Tuesday with ECNEC Chairperson and Prime Minister Sheikh Hasina in the chair, reports BSS. Of the six projects, four are new and two are revised ones. Of the total outlay of BDT 69.50 billion, the government will provide BDT 41.46 billion while BDT 26.62 billion will come as project assistance and the organisations concerned will contribute BDT 1.42 billion from their own funds, Planning Minister AHM Mustafa Kamal said while briefing journalists after the meeting. Dhaka Water Supply Network Development project will be implemented at a cost of BDT 31.82 billion aiming to enhance the capacity of DWASA for ensuring reliable round-the-clock safe water supply to the city dwellers.

Source: http://print.thefinancialexpress-bd.com/2016/05/25/142296

Bangladesh shows 28.0% growth in fisheries, aquaculture production: IORA

As one of the world’s leading inland fisheries producers and its aquaculture production, Bangladesh has shown an average growth of 28.0% with extensive and highly diversified fisheries resources, reports UNB. Considering all the factors, the Committee of Senior Officials (CSO) of Indian Ocean Rim Association (IORA) has decided that Bangladesh is best positioned to host the project of USD 50,000 which is titled ‘Small scale inland and/or coastal aquaculture project in the Indian Ocean Region’. Among the six projects, Bangladesh was awarded with two pilot projects titled ‘Small scale inland and/or coastal aquaculture project in the Indian Ocean Region’ and ‘Exploration of economically important marine flora from the Bay of Bengal, a pilot study’.

Source: http://print.thefinancialexpress-bd.com/2016/05/25/142303

Government plans to hike farm subsidy

The government may increase agriculture subsidy in the next fiscal year, as farmers are not getting fair prices for their produce, Finance Minister AMA Muhith said yesterday. “I think we have to give more subsidy to the farm sector as prices of the produce have fallen in the local markets due to a surplus in output,” Muhith said in a meeting with Shykh Seraj, a leading agriculture development activist and journalist, at the minister’s secretariat office in Dhaka. Seraj, also the director and head of news at private television Channel i, submitted a set of recommendations to the minister after a campaign for agriculture budget and welfare of the farmers. The government would provide subsidy for the farm sector so that the farmers can purchase fertilisers and farm machinery, and use the subsidised money for irrigation. Muhith said the government might also start purchasing maize from the farmers as its cultivation is gaining popularity in Bangladesh. Maize has a very big market worldwide, but in Bangladesh, farmers do not get fair prices for low demand. The number of poultry farms across the country declined to about 80,000 from more than 150,000 a few years ago, due to a lack of financial support from the government, Seraj added. Seraj urged the government to give higher subsidy to the fisheries sector to boost production.

Source: http://www.thedailystar.net/business/govt-plans-hike-farm-subsidy-1229017

Supermarket owners for removal of discriminatory VAT rate

Bangladesh’s supermarket owners have called upon the government to ensure a uniform Value Added Tax rate for all retail supershops. Bangladesh Supermarket Owners’ Association (BSOA) came up with the call during a meeting with the National Board of Revenue (NBR) held at the NBR headquarters in the city yesterday. Currently, 4.0% VAT is applicable to the sales of the supermarkets like Agora, Shwapno and Meena Bazar while the other shops enjoy a package VAT system on the basis of their shops’ sizes and locations. Urging the government either to withdraw 4% VAT or allow supermarkets to pay the package VAT as like other stores, Zakir said: “The sector will be completely devastated if the discriminatory VAT rate continues.” Currently, there are 14,000 stores just belonging to the two leading chain supermarkets in Indonesia while around 3,000 supermarkets in India and around 1,000 in Sri Lanka. Placing their demands, BSOA leaders also said: “The growth of the supermarket is being hampered due to the high duty imposed on capital machinery that varies from 65.0% to 106.0%, making it uncompetitive with the small local shops.” In response, NBR Chairman Md Nojibur Rahman has assured the businessmen that their demands would be taken into consideration as the government would place a business-friendly budget for the next fiscal year.

Source: http://www.dhakatribune.com/business/2016/may/25/supermarket-owners-removal-discriminatory-vat-rate

Most of the listed MNCs maintain steady dividend growth trend

Most of the multinational companies (MNCs) listed with the local bourses declared significant amount of cash dividends for the year ended on December 31, 2015, maintaining their profit growth. Majority of the 13 listed multinational companies that account for 26.0% of the total market capitalisation of Dhaka Stock Exchange (DSE) as on April 30, 2016 maintained a steady growth trend in dividends. Of them, 11 firms declared dividends so far for the year ended on December 31, 2015 till date. Five MNCs declared higher dividends, three declared lower dividends, while three declared same dividend in 2015 than the previous year, the DSE data showed. Seven companies – BATBC, Glaxo SmithKline, Berger Paints, Linde BD, Heidelberg Cement, GP and Singer BD–already held annual general meetings (AGM) recently. Reckitt Benckiser topped the list in terms of dividend declaration. The company recommended 650.0% cash dividend for the year ended on December 31, 2015. In 2014, the company disbursed 550% cash dividend.

Source: http://print.thefinancialexpress-bd.com/2016/05/25/142282#prettyPhoto

Cheap cigarette taxes likely to go up

The government might increase both price slab and tax rates of cheap cigarettes in the budget for fiscal year (FY) 2016-17 with the aim to reduce the consumption of the item. Price slab for 10-stick packet of cigarettes is likely to be raised to BDT 22.0 or more from the existing price of BDT 18.0 and Supplementary Duty (SD) to 50.0% from the existing 48.0%. There may be three-tier price slab for cigarettes instead of existing four tiers. Cigarettes belonging to lowest slab have 79.0% share of the market. But, their contribution to the total revenue from the sector has been very low. Currently, consumers of cheap cigarettes under price slab BDT 18.0 are paying 48.0% SD. The NBR in a summery to the finance minister proposed to increase it to BDT 27 and above while SD to 54.0%. Currently, consumers of cheap cigarettes underprice slab BDT 18.0 are paying 48.0% SD. The NBR in a summery to the finance minister proposed to increase it to BDT 27 and above while SD to 54%. However, the finance minister cut it down to a minimum BDT 22.0 and fixed SD at 50.0% for cheap cigarettes. The finance minister proposed new two slabs one of BDT 45.0 having 62.0% SD and another of BDT 70.0 with 64.0% SD. For bidi, the tariff value might be increased by 42.0 to 45.0% while for gul and Jarda (non-smoking tobacco) tax is likely to be raised to 100% from existing 60%. For handmade bidi (without filter), tariff value has been set at BDT 2.25, BDT 3.40 and BDT 7.10 by imposing 30.0% SD on 8 sticks, 12 sticks, and 25 sticks of bidi respectively.


World Stock and Commodities

Index NameClose ValueValue ChangePercentage Change
Crude Oil (WTI)*$49.25+0.63+1.30%
Crude Oil (Brent)*$49.17+0.56+1.15%
Gold Spot*$1,228.24+1.03+0.08%
Dow Jones Industrial Average17,706.05+213.12+1.22%
Nikkei 22516,795.67+296.91+1.80%
FTSE 1006,219.26+82.83+1.35%

Exchange Rates 

USD 1BDT 78.36*
GBP 1BDT 114.51*
EUR 1BDT 87.37*
INR 1BDT 1.16*

*Currencies and Commodities are taken from Bloomberg.




Dear Valued Patrons,

At the very onset, let me express my heartiest gratitude for allowing us to serve you and I also wanted to reach out to you directly with an assurance that Dhaka Bank is fully equipped to support you during this difficult time.

Last couple of weeks ago we all were living in a peaceful condition, performing our daily tasks freely and perfectly. Entire economy and business environment was also in a good shape, until COVID-19 put a forceful stoppage to the overall life style and economy of the world. We all know that social distancing and cleanliness are the keys to prevent this pandemic. Hence, we urge your conscious effort to limiting public interaction and suspending wherever possible.

In this current situation, Dhaka Bank and its employees are beside you where we are fully online, either working from home or at our offices under a robust Business Continuity Plan (BCP) to serve you with limited branch banking and a full-fledged alternate delivery channel services.

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Moreover, to fulfill your urgent requirement, we have a limited no. of branches up and running by ensuring all kinds of precautionary and safety measures for you.

In case of extreme emergency and facing difficulties in conducting banking transactions, please let us know through our 24/7 Contact Center number 16474 (or, dial +8809678016474 for ISD/Overseas Calls). We are always with you to combat your difficulties.

As you know we are going through a critical phase and the situation is novel to all of us. We are getting lot of new information from various sources everyday about COVID-19 which will be shared at www.dhakabankltd.com.

Thank you for your trust and continued support to us. I firmly believe that jointly we will be able to combat this situation and win against all the odds.

Please stay home, stay safe and take care of yourself and family.

Best regards,

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Managing Director & CEO
Dhaka Bank Limited