Bangladesh Krishi Bank struggling as cash crunch affects LC, remittance services
Bangladesh Krishi Bank was struggling to operate some of its services due to capital shortfall, officials said. They said the government owes the country’s largest specialized bank BDT 15.6 billion against interest subsidy and interest waiver, creating the capital shortfall and affecting the banking services. As of June last, the capital shortfall stood at BDT 74.1 billion, according to Bangladesh Bank (BB) data. The bank was facing difficulties in opening letters of credit (LCs), including the ones of the state-owned organizations, and providing remittance services, a senior executive of the bank said.
Bangladesh Bank asks bKash to closely monitor agents to check money laundering
Bangladesh Bank has asked mobile banking operator bKash, a subsidiary company of the BRAC Bank, to closely monitor its agents to check money laundering and terrorist financing. The central bank directive came from a meeting with bKash at the central bank headquarters in the capital on Monday. Central bank’s Payment System Department acting general manager Rezaul Karim presided over the meeting while bKash chief executive officer Kamal Quadir and officials of Bangladesh Financial Intelligence Unit were present. The central bank asked bKash to ensure physical presence of the accountholder when he or she withdraws cash from the agents. A BB official told New Age on Tuesday that an inspection team of Bangladesh Financial Intelligence Unit, a wing of the central bank, had conducted a random investigation into some bKash agents in the Rajshahi town on July 13 this year. The inspection team unearthed that the bKash agents gave money (cash-out) to the clients in favor of the accountholders violating the rules. The agents released the money by only taking signature from the persons, according to the inspection report. The investigation report said that any withdrawal of money from the agents of mobile financial service providers, especially bKash, in absence of the account holders posed risk that the money could be used in terrorism and paying ransom to kidnappers.
BSEC to probe National Bank Limited move to buy BDT 560 million worth of flats
The Bangladesh Securities and Exchange Commission has formed a three-member committee to investigate into a National Bank move to purchase 50 flats worth BDT 555.7 million. The BSEC committee, comprised of its director Md Monsur Rahman, deputy director Mohammed Nazrul Islam and assistant director Md Bony Yeamin Khan, was formed on Sunday. On October 17, this year, the NBL announced that its board of directors had decided to purchase 50 flats having 74,970 square feet (approximately) along with 50 car parking spaces in a 14-storey residential building with one basement at Mohammadpur in Dhaka. An NBL official on Tuesday said, ‘The bank has postponed the decision [purchasing flats] for the time being. It is renegotiating with companies over loans against which the flats would be taken over.’ ‘We are not aware of the BSEC’s move in this connection,’ he said. The BSEC initiative came following a complaint submitted by an investor to the finance ministry that was later forwarded to the commission for further action.
An enormous market in low- and middle-income housing finance remains untapped in the country due to the financial sector’s focus on upper-middle class housing finance and lack of policy support. According to a study report of World Bank Group (WBG), the market is to grow by 2020, as demand for low- and middle-income housing finance has increased from the total housing finance supply in 2015.The report projects that demand for low- and middle-income housing finance could reach BDT 818.2 billion or USD 10.4 billion at current exchange rate, as the financial sector’s total outstanding housing loans was BDT 489.9 billion in 2015. “Thus, the demand for low- and middle-income housing finance in 2020 will be 167.0% of the size of the total housing finance supply in 2015,” the report predicts.
Sector-wise trade unions in industrial units on the cards
State Minister for Labour and Employment M Mujibul Huq said the government was considering formation of sector-wise trade unions in industrial units, reports BSS. Denmark would give technical assistance in this connection, he said speaking at a press briefing after a meeting with Danish Ambassador Mikael Hemniti Winther at Bangladesh Secretariat in the city, said an official release. The state minister said the government wanted to make use of Denmark’s experience in creating confidence in owner-worker relations in industries through social dialogue.
The government may reduce the rate of package VAT for small and medium traders for the current financial year 2016-17 following demand of the business community. The National Board of Revenue has decided to cut down the existing amount of package value-added tax and will send a proposal to finance minister AMA Muhith in this regard, NBR officials said. The revenue board, however, has yet to make any decision on how much the rate, which was made almost double in the budget for the current fiscal year, will be reduced. The government high-ups will decide it, they said adding that the decision would be finalized soon. The decision was made following a series of negotiations with agitating traders under the platform of Babosayee Oikkya Forum and the representatives of the Federation of Bangladesh Chambers of Commerce and Industries. The forum on November 20 postponed their planned indefinite strike demanding setting the package VAT at lower level and restoration of the system in the new VAT law and other issues until December 1 following a meeting with the NBR. Finance minister in the budget doubled the package VAT and set at BDT 28,000 for traders in Dhaka and Chittagong city corporation areas which was BDT 14,000 in the previous year. The package VAT for shops in other city corporations was raised to BDT 20,000 from BDT 10,000, at the district town level to BDT 14,000 from BDT 7,500, and at the upazila level the VAT amount was raised to BDT 7,500 from BDT 3,600.
The Wage Board has finalized its draft proposal recommending more than 122.0% hike in minimum monthly pay for the workers in divisional city and city corporations of the country’s pharmaceutical industry, officials said. The board, in a gazette notification issued on November 23 last, also sought written objections and recommendations, if any, within the next 14 days. The board recommended BDT 8,200.0 and BDT 8,050.0 minimum monthly wages for an unskilled worker living in divisional city and city corporations respectively. A BDT 4,600.0 and BDT 4,500.0 have been proposed as basic payment for unskilled workers living in divisional city and city corporations, according to the draft. In both areas, a 50% of the basic payment has been proposed as house rent, BDT 700.0 as medical allowance and BDT 600.0 for transportation. The last minimum wage for the workers and employees of the sector was set at BDT 3,625.0 and BDT 4,500.0 respectively in 2009, according to officials.
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