Blog - BankInfoBD

Banks reduces lending rate to single digit

Thu, 09 Aug 2018 12:02:00 +0000

The country’s scheduled banks are offering single digit interest rate for all products, except consumer loans and credit card, to their clients as per the decision of a recent meeting between Finance Minister AMA Muhith and the bank authorities.

“As per the decision, each bank is bringing down their interest rates to single digit. Banks are implementing this decision,” Secretary General of the Association of Bankers Bangladesh (ABB) M Arfan Ali told media today.

Recently, Finance Minister AMA Muhith told the journalists that the interest rate in the banking sector will come down to single digit from August 9 since the chairmen and the managing directors of the banks agreed to implement the new rate as per the directive of Prime Minister Sheikh Hasina.

He said the interest rate for consumer loan and credit card will be flexible as per the banks’ obligations.

M Arfan Ali, also managing director of the Bank Asia Limited, said his bank is working on lowering the lending rate. “The new rate is likely to decrease our bank’s income, but we can adjust it by reducing other expenses,” he added.

He said the single digit interest rate against bank lending will increase the private sector investment that will help take the country’s economic growth to a sustainable level.

Talking to this correspondent , chairman of Mercantile Bank Limited (MBL) AKM Shaheed Reza said the MBL board of directors took the initiatives from July this year when Bangladesh Association of Banks (BAB) took the decision of the single digit interest rate.

“MBL is disbursing the industrial and corporate loans in single digit from July. For single digit interest rate, our income has decreased but we adjust the income by reducing other expenses,” he added.

He said the single digit interest rate will boost further the country’s economy, which will help achieve the country’s development goals, including ‘Vision-2021’ and ‘Vision-2041’.

NCC Bank Chairman M Nurun Newaz said the board of directors of the bank has already instructed the senior officials to lower the interest rate as per the decision.

“Banking sector should bring down the interest rate to a single digit to expedite the country’s economy,” he added.

Bangladesh Bank Chief Spokesperson M Serajul Islam said this is the own decision of the chairmen and managing directors of banks. BB is only providing its ethical pressure on banks to bring down the lending rate to single digit as per their commitment, he added.

Earlier, BAB, an association of private commercial banks, at a meeting decided to bring down the lending rate to a single digit and deposit rate for the three months tenure to 6 percent from July 1, the first day of fiscal 2018-19.

But, all banks could not implement the decision properly. On the other hand, the government has given incentives, including 5.5 percent CRR, to mitigate their liquidity crisis and bring the interest rate to single digit.

The government has also taken a decision to allow the state agencies to deposit 50 percent of their funds instead of 25 percent in private banks.
News.businessnews24bd.com.

Banks’ investments in corporate bonds to be high-quality liquid asset

Wed, 02 Aug 2017 02:44:00 +0000

Basel-III requirements for capital adequacy

Commercial banks are likely to be allowed to include their investments in corporate bonds as high-quality liquid asset under liquidity-coverage ratio (LCR) of Basel-III framework.

Bangladesh Bank (BB) made such observations Tuesday at a coordination meeting of major watchdog bodies, namely the Bangladesh Securities and Exchange Commission (BSEC), the Office of the Registrar of Joint Stock Companies and Firms, the Insurance Development and Regulatory Authority (IDRA), the Micro-credit Regulatory Authority (MRA), the Department of Cooperatives (DoC) and Bangladesh Telecommunication Regulatory Commission (BTRC).

At the meeting, held at the BB headquarters, the BSEC requested the central bank to allow the banks to comply with the BB's statutory liquidity ratio (SLR) requirement with their investment in the corporate bonds, as a way of stimulating the capital market.

The central bank failed to agree with the proposal, placed at the meeting, presided over by BB Governor Fazle Kabir.

To justify the refusal, according to officials, the central bank said only the approved securities are eligible for meeting the SLR obligation to the BB.

The approved securities are usually treasury bills (T-bills), bonds and other securities whose principal and interest are guaranteed by the government and also include BB'a own securities

Rather, the BB expressed its willingness to consider such bonds as high- quality liquid asset but their eligibility will be positively examined by the departments concerned of the central bank, they added.

"We may allow the corporate bonds as high-quality liquid asset under LCR of Basel-III framework after examining its different aspects," SK Sur Chowdhury, deputy governor of the BB, told the FE after the meeting.

News:Financial Express/2-Aug-2017

Movable property to serve as collateral as BB drafts law

Wed, 02 Aug 2017 02:36:00 +0000

A move is underway to recognise movable property, too, as collateral against credits.

Bankers believe that such a change in traditional mortgage system will help expand lending and spur economic activities.

Bangladesh Bank (BB) has already prepared a draft law titled 'The Secure Transaction Act' providing for such non-traditional mortgage system, officials said.

They said BB is expected to finalise the draft within this month. Thereafter, it will be sent to the Ministry of Law, Justice and Parliamentary Affairs for placing before Parliament for approval.

Movable property like goods, a document of title, security, instrument, money or any other intangible asset like goodwill will be regarded as collateral after enactment of the law in the making.

These are not accepted now in the financial sector as security for loans. Currently, only the immovable like house or flats, land property are accepted by banks and financial institutions as collateral.

People familiar with the latest move at the central bank told the FE that this would promote economic activities in the country, and reduce the dependence of lending institutions on immovables as security for credit facilities.

This innovation is being financed by Japanese aid-agency JICA under a project named 'secured lending and movable collateral reform in Bangladesh'.

A senior person familiar with the developments at the central bank told the FE that they were expecting to finalise the draft by August 30.

A senior official at the Ministry of Finance (MoF) said this initiative is intended to help small and medium entrepreneurs and those engaged in self-employment who are unable to furnish immovable property as security against credits.

"SMEs, even startups, may be benefited as their access to the formal credits will rise," said a senior official at the MoF.

However, a high-powered monitoring team will meet on the matter at the MoF on August 29.

Bankers view that this is a piece of good news for them as it will help expand the volume of credits as the banking system now rolls in "excess liquidity".

They also hope this will bring dynamism in the business sectors as well the economy as many will have access to loans based on such property which the banking system has so far ignored as collateral. Managing Director & CEO of Mutual Trust Bank Ltd (MTB) Anis A. Khan said: "We welcome this type of initiative as it brings dynamism in the economy."

He also sees nothing wrong in it. Many will get loans for further investment in business and it will help widen the base of collateral.

"The higher security, the higher loans," he told The Financial Express.

Mr Khan, also chairman of the Association of Bankers, Bangladesh Limited (ABB), said many will be even able to get loans against their motorised vehicles.

"It will have spillover impact on the economy. The insurance sector will also get some sort of business."

Another banker, Md Nurul Amin, managing director and CEO at Meghna Bank, said they had long felt the necessity of such arrangements.

"Such type of collateral exists in many countries, even in Sri Lanka," he said as an example to justify this initiative towards diversifying collateral.

Mr Amin, however, sees some risks of such type of security, such as the owners of such property may sell those to other parties and thus cause a problem to the lending banks.

"Suppose, a person gave his vehicles as collateral to a bank and he could sell it to other people, and in such cases bank may face problems."

Similarly, he added, the owners of factories may sell their machinery out to others.

However, there will be a separate entity paving the way for people to borrow by using such moveable property as security under the act.

The institution will help lenders get a risk-free picture of the security to accept movable property as collateral for advances.

The oversights body will be established under the name 'Secured Transaction Registration Authority'.

The main objective of the authority will be to promote the interests of the national economy by facilitating secure transaction against movable property in compliance with the provisions of the act.

The governor of Bangladesh Bank will be chairman of its board or a person nominated by him as his representative will work in the entity.

Under the law, the MoF secretary or a person to be nominated by him will stand as second in authority at the Authority. A registrar will also need to be appointed, according to the draft act.

The draft also states a designated person from Bangladesh Securities and Exchange Commission will also be on the board.

The main function of the board is to ensure registration of security rights of movable property.

News:Financial Express/2-Aug-2017

Agrani not closing loss-making exchange house in Canada

Wed, 02 Aug 2017 02:22:00 +0000

The board of directors of Agrani Bank now wants to keep running its loss-making money exchange house in Canada, for which it earlier received regulatory approval to shut it down.

Since its inception in 2014, the Agrani Remittance House Canada incurred a loss of $308,448 and brought in $3.5 million in remittance to Bangladesh.

The banking regulator gave go-ahead when the bank wanted to close operation of the exchange house in June last year.

The BB then said the bank established the exchange house without conducting a feasibility study and wasted a huge amount of foreign currency.

The bank was then strictly warned for taking such an unwise decision. But, now the bank is repeatedly seeking extension of the exchange house's activities for a year. The regulator rejected Agrani's proposal for the third time last month.

Agrani is trying to continue operation of the exchange house due to the demand of Bangladeshi expatriates living in Canada, said Mohammad Shams-Ul Islam, managing director of the bank.

“We took various measures to reduce the expenditure of the exchange house, and the remittance inflow through the branch has gradually been improving,” Islam said. “It is our last attempt to keep Bangladesh's flag hoisted in Canada.”

The bank received BB's consent to open the exchange house in 2012 and started its operation in June 2014. The bank has so far invested around $680,000 to establish the exchange house, according to the BB report.

Due to the high expenditure, the exchange house made a loss of $153,000 in the first year of its operation in 2014 although it brought in around $564,000 in remittance.

In 2015, the amount of loss decreased to around $100,000 although the branch channelled around $1.5 million in remittance into Bangladesh.

In 2016, the bank managed to minimise the loss to $60,704 while the remittance through the exchange house touched around $1.5 million, according to Agrani data.

Canada was the 20th top remittance sending country for Bangladesh in 2015-16. Bangladesh received $55.10 million in remittance from Canada, 2.79 percent of which came through the exchange house.

The remittance inflow from Canada decreased by 10 percent year-on-year to $49.54 million in 2016-17, according to the central bank data. Currently, Exim Bank has a money exchange house in Canada and has remittance drawing arrangement with seven money exchange houses of the country.

Agrani fell in a capital shortfall of Tk 442.63 crore in March this year from a surplus of Tk 46.56 crore in December last year, central bank data shows.

The classified loan of the bank also increased to 25.83 percent from 25.44 percent during the same period. The bank made a net profit of Tk 59.56 crore in March this year.

The bank has 935 branches across Bangladesh. Of them, 78 counted loss in 2016 while the number was 16 in the previous year.

News:Daily star/2-Aug-2017

Bank of England staff strike for first time in 50yrs

Wed, 02 Aug 2017 02:14:00 +0000

Staff at the Bank of England began a three-day strike Tuesday, the first at Britain's central bank in more than 50 years, as part of a dispute over pay. Employees from the maintenance, security and frontline hospitality departments walked out over what the Unite union said was a "derisory", below-inflation pay offer for the second year running.

Union official Peter Kavanagh urged the governor of the bank to personally intervene in the dispute, threatening to escalate the industrial action if there was no breakthrough.

"Mark Carney should come to the picket lines outside this iconic British bank today and explain why hardworking men and women deserve to face years of pay cuts," Kavanagh said.

News:Daily Star/2-Aug-2017

City Bank's half-yearly profits fall

Wed, 02 Aug 2017 02:06:00 +0000

City Bank's net profit fell 5.3 percent year-on-year to nearly Tk 191 crore in the first half of 2017, the first generation lender said yesterday.

The bank's earnings per share went down to Tk 2.18 in January-June from Tk 2.30 in the same period a year earlier.

Sohail RK Hussain, managing director of City Bank, disclosed the performance of the bank at a media briefing at its headquarters in Dhaka.

In the first six months, its loan portfolio grew 15.2 percent and deposits 19.1 percent while trade volume also increased by 20 percent.

City Bank shares have witnessed an upward trend in the last several days, ending at Tk 42.30 yesterday.

In fact, its stocks have remained buoyant since March this year when it received nod to sell 5 percent of its shares to the International Finance Corporation, the private sector lending arm of the World Bank Group.

The IFC bought a City Bank share at Tk 28.3, including Tk 18.3 as premium.

Mahbubur Rahman, chief financial officer of City Bank, gave an overview of the recent financial performance of the lender during the programme.

Most banks have reported higher half-yearly profits this year riding on an increased business activity amid a stable political situation and a boost in investors' confidence.

News:Daily star/2-Aug-2017

Grameen Bank wants power back to elect borrower-directors

Wed, 02 Aug 2017 01:58:00 +0000

The head of Grameen Bank board is seeking changes to the electoral rules of the microcredit lender so it can pick nine directors from the borrowers -- like it did since its inception.

If the changes are approved by the government, the Nobel Peace Prize-winning organisation would get back its power to elect directors -- an exercise that has been taken over by the government in 2014.

Three government-appointed directors are running Grameen Bank since February 2015 after the tenure of the nine elected directors came to an end.

Although the rules for the election of directors were changed in 2014, no election has taken place since.

Subsequently on July 16, Grameen Bank Chairman K Mozammel Haque wrote a letter to Finance Minister AMA Muhith seeking approval to change some of the electoral provisions.

“What I have said in the letter is that Grameen Bank should be allowed to run in the way it was allowed to run in the past,” Haque told The Daily Star yesterday.

He said his proposals sought to appoint one of its officials to oversee the elections of the directors and the directors would be picked through the three-tier elections.

The letter said the proposed changes aim to help solve the current complexity as the new rules are not being applied.

If the proposed amendments to the provisions are approved, the election of the directors could be organised in the quickest possible time, it said.

“This will ensure formation of the full board. At the same time, this will diminish the importance of the ongoing case in courts.”

The GB board is a 12-member body. Nine board members are directly elected by shareholders and borrowers of the bank, while the rest, including the chairman, are nominated by the government.

When the electoral rules were framed in April 2014, it gave the central bank the task to form a three-member commission to elect the nine directors.

The rules stipulated that the election has to be held within six months after it comes into effect.

But the central bank objected to the additional responsibility.

Later, the banking division of the finance ministry amended the rules in October 2014, saying the government itself would form a three-member committee to elect the directors.

The rules said the committee will have two deputy managing directors, one from a state-owned commercial bank and another from Palli Karma-Sahayak Foundation. A former district judge will serve as the chief election commissioner.

The amended rule also changed the timeframe for electing the board of directors: it gave 12 months from the date of formation of the election commission as opposed to six months from the activation of the rules.

But still the election has not taken place.

Meanwhile, the nine elected directors demanded that their directorship in the board had remained intact as the election schedule was not announced and the election did not take place as per the new rules. They filed a writ petition in court in 2015.

The case is under trial, said the Grameen Bank chairman in the letter.

Haque's letter said many important tasks remain stuck at a financial organisation if there is an absence of a full board for a long time. This disrupts the running of all activities in a disciplined way.

If the changes are approved, the election of the directors would take place like in the past, according to a senior official of Grameen Bank.

“It would be good for the bank if the election is held,” he said, seeking anonymity as he is not authorised to make comments on issues relating to the board.

As per the previous rule, the Grameen Bank board picked an official of the bank to conduct the elections.

News:Daily star/2-Aug-2017

Modhumoti Bank opens Digital Point in Gazipur

Wed, 02 Aug 2017 01:38:00 +0000

Modhumoti Bank Managing Director and CEO Md Shafiul Azam inaugurates the Modhumoti digital points at Sreepur in Gazipur on Tuesday.

Modhumoti Bank opened ‘Modhumoti Digital Banking’ at Mawna, Barmi, Telihati, Kaoraid and Gazipur UDC agent points on Tuesday.

The launching ceremony was held at Sreepur Upazila Parishad auditorium in Gazipur, said a press release.

Md Shafiul Azam, Managing Director and CEO of Modhumoti Bank Limited inaugurated the Modhumoti digital points as chief guest, said a press release.

Rahana Akter, Upazila Nirbahi Officer, Sreepur, Gazipur presided over the ceremony.

Alhaj Abdul Jalil, Chairman of Sreepur Upazila Parishad, Md. Shaheen Howlader, Head of SME and Retail Banking Division of Modhumoti Bank Limited, Moklesur Rahman, Senior Vice President, Agent Banking Division, local UP Chairman’s and elites were present as special guests.

Modhumoti Bank took the initiative of agent banking through signing an agreement with the program Access to Information (a2i) of Prime Minister's Office, where the entrepreneurs of Union Digital Center (UDC) shall be the agent of the bank.

News:Daily sun/2-Aug-2017

StanChart signs deal with BSH

Wed, 02 Aug 2017 01:31:00 +0000

Standard Chartered Bank Head of Retail Products and Segments Makam E Mahmud Billah and Bangladesh Specialized Hospital Managing Director MA Kabir exchange documents after signing an agreement at the bank’s head office at Gulshan in the city recently.

Standard Chartered Bank and Bangladesh Specialized Hospital Limited (BSH) signed a Memorandum of Understanding (MoU) at the bank’s head office at Gulshan in the city recently.
Under the MoU, Bangladesh Specialized Hospital will offer discounts on pathological and radiological tests to all Standard Chartered cardholders, said a press release.
Apart from that, all Standard Chartered credit cardholders will also enjoy 0 percent InstaBuys (EMI) facilities with up to 12 months tenure.
Makam E Mahmud Billah, Head, Retail Products and Segments, Lutful Habib, Head, Client Acquisition, Razimul Haque, Director, Rewards and Alliances, Standard Chartered Bank and MA Kabir, Managing Director, Dr. Ahmed Zahid Hossain, Director (operation), Bangladesh Specialized Hospital were present on the occasion.

News:Daily sun/2-Aug-2017

Standard Bank opens haj booth at Ashkona

Wed, 02 Aug 2017 01:21:00 +0000

Standard Bank Deputy Managing Director Md Motaleb Hossain inaugurates a Haj booth at Haj Camp at Ashkona in the capital on Sunday.

Standard Bank Limited inaugurated its Haj Booth at Haj Camp, Ashkona, Dhaka on Sunday.
Deputy Managing Director of the Bank Md. Motaleb Hossain formally inaugurated the Haj Booth, said a press release.
SBL distributed umbrella, prayer mat, waist belt and mina bag among 1,500 Haji.
Sharif Zahirul Islam, Head of Cards and Mejba Uddin Ahmed, Public Relations Officer of SBL were present on the occasion.

News:Daily sun/2-Aug-2017

Md. Arfan Ali, Managing Director of Bank Asia Ltd, poses with the participants of a day-long training programme on "Agent Banking Activities and Operational Procedures" at its training and development institute in the city on Saturday. Top officials of th

Wed, 02 Aug 2017 01:02:00 +0000

Md. Arfan Ali, Managing Director of Bank Asia Ltd, poses with the participants of a day-long training programme on \"Agent Banking Activities and Operational Procedures\" at its training and development institute in the city on Saturday. Top officials of

News:new nation/2-Aug-2017

AKM Saifuddin Ahamed, DMD, Jamuna Bank Limited and Sohail Majid, Deputy Director (Marketing & Sales) of US-Bangla Airlines Ltd, exchanging an agreement signing documents at the bank’s head office in the city recently. Under the deal, employees and credit

Wed, 02 Aug 2017 00:53:00 +0000

AKM Saifuddin Ahamed, DMD, Jamuna Bank Limited and Sohail Majid, Deputy Director (Marketing & Sales) of US-Bangla Airlines Ltd, exchanging an agreement signing documents at the bank’s head office in the city recently. Under the deal, employees and

News:new nation/2-jul-2017

BASIC Bank falls short of BB's performance targets

Tue, 01 Aug 2017 05:34:00 +0000

Scam-riddled BASIC Bank has failed to comply with the conditions imposed by the Bangladesh Bank for 2016 with the singular view of improving its financial health.

For instance, the bank last year went past the single borrower exposure limit, lending Tk 620 crore more than it is permitted to by the rule to a total of 20 clients, according to a BB report.

Alauddin A Majid, chairman of BASIC Bank, acknowledged the transgressions, adding that most of the loans were extensions of old loans.

Of the total excess loan amount, about Tk 200 crore were new loans, he said.

The BB had set a recovery target of Tk 1,118 crore from defaulted borrowers, but the state-run lender could manage only 12.5 percent of the sum.

The recovery from top 20 defaulters was more disappointing: it managed only 1.63 percent against the target of Tk 538 crore.

But the recovery from other defaulters was relatively better as the lender managed to collect nearly Tk 132 crore against the target of Tk 580 crore.

The recovery from bad loans was very poor last year as many of the clients who were given loans violating rules during the tenure of earlier board could not be traced, said a senior executive of BASIC Bank.

The bank failed to cut its default loans by Tk 1,974 crore last year. Instead, it went up by Tk 648 crore.

As of March, the lender's total default loans swelled and stood at 53.9 percent, or Tk 7,373 crore. Furthermore, it failed to maintain the capital adequacy ratio. Its capital adequacy ratio went to 12.52 percent in the negative against the target of 10.6 percent.

Despite a capital injection of Tk 1,200 crore in 2015, BASIC incurred huge capital shortfall of Tk 2,684 crore at the end of December last year.

As of March, the capital shortfall was Tk 2,961 crore. BASIC focused on quality loan disbursement to overcome losses as it has huge deposits, according to Majid.

As of March, BASIC's advance deposit ratio, which measures loans as a percentage of deposits, was 99.26 percent, which is more than the authorised limit of 80 percent, according to central bank data.

The bank's loan growth last year was 5.54 percent against the BB-imposed ceiling of 12 percent.

News:Daily Star/1-Aug-2017

Bank manager hangs himself

Tue, 01 Aug 2017 04:56:00 +0000

Police recovered the hanging body of the branch manager of Jamuna Bank's Beanibazar branch from his rented residence in Sylhet district on Monday afternoon.

The deceased was identified as Sajal Kanti Dev, a resident of Bagbari area of the district town, and father to a son and daughter. His family members live in the city, reports UNB.

Chandan Kumar Chakrabarti, Officer-in-Charge of Beanibazar Police Station said Sajal used to live on the third floor of the Al-Arafah Bank building with a colleague. He would go home for lunch during his break before returning to office.

"Today at lunch time he went to his residence but didn't return. That's why some employees went there and knocked but he did not respond. So, they informed owner of the building, local councillor and police," the OC relayed.

Later, police broke the door and recovered the body hanging by a rope from a fan. It was subsequently brought down and sent to Osmani Medical College Hospital.

The reason behind the suicide could not be known immediately, OC added.

News:Finacial Express/1-Aug-2017

NRB Global Bank opens branch at Madhabdi

Tue, 01 Aug 2017 04:38:00 +0000

NRB Global Bank Chairman Nizam Chowdhury inaugurates a branch of the bank at Madhabdi in Narsingdi on Sunday.

NRB Global Bank opened a new branch at Madhabdi in Narsingdi on Sunday.

Nizam Chowdhury, Chairman of the bank inaugurated the branch as chief guest, said a press release.

Director Rashed Uddin Mahmud, Managing Director Proshanta Kumar Halder, divisional heads of head office, branch managers and distinguished clients were also present on the occasion.

The new branch will provide quality services to the customers and will expand its network at home and abroad to provide ‘Great Experience’ to its stakeholders.

News:Daily sun/1-Aug-2017

NRBC Bank organises business dev dialogue

Tue, 01 Aug 2017 04:31:00 +0000

NRBC Bank organised a programme on Business Development Dialogue at a hotel in the city on Saturday.

Heads of 52 branches of the bank took part in the meeting, said a press release.

Managing Director and CEO along with high officials of head office of the bank was present in the programme.

Managing Director in his speech congratulated all managers for the overall performance of the bank upto June 2017 despite multifarious obstacles.

An open discussion was conducted regarding bank management and the existing situation of the bank in the programme.

During the discussion, it was emphasised to sustain the asset quality and credit management of the bank and to give all out efforts to achieve business target at the end of the year.

News:Daily sun/1-Aug-2017

Shamsuddin Ahmed, Ph.D, Chairman of Prime Bank Securities Limited, poses with the participants of two-day long training sessions on "Customer Relationship Management, Spiritual Laws of Success, Time Management and Stress Management' at the bank's training

Tue, 01 Aug 2017 04:16:00 +0000

Shamsuddin Ahmed, Ph.D, Chairman of Prime Bank Securities Limited, poses with the participants of two-day long training sessions on \"Customer Relationship Management, Spiritual Laws of Success, Time Management and Stress Management\' at the bank\'s train

News:new nation/1-Aug-jul-2017

BB governor for more initiatives to control classified loan

Tue, 01 Aug 2017 04:04:00 +0000

Bangladesh Bank (BB) Governor Fazle Kabir on Monday asked the chief executives of scheduled banks and financial institutions (FIs) to be more active in controlling the classified loans for sustaining the economic growth and maintaining stability in the financial sector.
"Despite some uncertainty in the world economy, Bangladesh economy demonstrated a notable resilience and stability in 2016. To maintain the financial stability, we should take more measures by ensuring good governance in the sector," he said while addressing a programme with BB officials and chief executive of banks and financial institutions.
The programme was organised at the central bank Headquarters to launch BB's annual "Financial Stability Report 2016".
Fazle Kabir also advised the bank and FIs to strengthen efforts for avoiding any unexpected incident in the sector for maintaining the financial stability like previous year.
He stressed on building a high standard risk management culture in the banks and FIs to check any kinds of unexpected risk saying that banks and FIs will have to take more effective steps to tackle the cyber risk which has been creating new worries globally.
Among others, BB Deputy Governor Shitangshu Kumar Sur Chowdhury and Association of Bankers, Bangladesh (ABB) Chairman Anis A Khan spoke on the occasion.
SK Sur Chowdhury emphasised on effectively use of the Macroprudential Supervision strategy to tackle systematic risk in the financial sector.
He suggested the banks and FIs to take programmes by maintaining coordination with the Vision-2021 and Sustainable Development Goals (SDGs).
According to the report, the domestic macro-economic situation was mostly favorable in 2015-16 financial year (FY16). A real GDP growth of 7.1 percent was recorded in FY16 against the growth of 6.5 percent recorded in FY15.
Inflation declined to 5.9 percent in FY16 from 6.4 percent in FY15 attributable to accommodative money growth, lower fuel and commodity price in the international market and sufficient domestic food supply. It is noteworthy that at end-December 2016 general inflation stood at 5.5 percent against 6.2 percent of end-December 2015.
The current account balance in the balance of payments recorded notable surplus owing to the reduced deficits in trade, service and income accounts. The gross foreign exchange reserves stood at USD 32.1 billion at end-December 2016.

News:new nation/1-Aug-2017

Sharif Zahirul Islam, Head of Cards of Standard Bank Limited and Prof. Dr. Zabrul SM Haque, CEO of Asgar Ali Hospital, exchanging an agreement signing documents at the banks head office recently. Under the deal, cardholders and employees of the bank will

Tue, 01 Aug 2017 03:56:00 +0000

Sharif Zahirul Islam, Head of Cards of Standard Bank Limited and Prof. Dr. Zabrul SM Haque, CEO of Asgar Ali Hospital, exchanging an agreement signing documents at the banks head office recently. Under the deal, cardholders and employees of the bank will

News:new nation/1-Aug-2017

Md. Ridwanul Hoque, SVP of Midland Bank Limited and Sohail Majid, Deputy Director (Marketing & Sales) of US-Bangla Airlines signing an agreement at the bank's head office in the city on Sunday. Under the deal, Visa Credit Card holders of the bank will enj

Tue, 01 Aug 2017 03:47:00 +0000

Md. Ridwanul Hoque, SVP of Midland Bank Limited and Sohail Majid, Deputy Director (Marketing & Sales) of US-Bangla Airlines signing an agreement at the bank\'s head office in the city on Sunday. Under the deal, Visa Credit Card holders of the bank will en

News:new nation/1 -Aug-2017

AE Abdul Muhaimen, Managing Director of UCB and Leo Zhuang, Managing Director of Liz Fashion Industry Ltd. shaking hands after inaugurating Internet Banking Service at the bank's head office in the city recently. Top officials from both the organizations

Tue, 01 Aug 2017 03:37:00 +0000

AE Abdul Muhaimen, Managing Director of UCB and Leo Zhuang, Managing Director of Liz Fashion Industry Ltd. shaking hands after inaugurating Internet Banking Service at AE Abdul Muhaimen, Managing Director of UCB and Leo Zhuang, Managing Director of Liz Fashion Industry Ltd. shaking hands after inauguthe bank\'s head office in the city recently. Top officials from both the organizations

News:new nation/1-Aug-2017

Md. Arfan Ali, Managing Director of Bank Asia Ltd. poses with the participants of the 5th EC and 1st General Meetings of SWIFT member and users group of Bangladesh at a hotel in the city on Wednesday. Kazi Masihur Rahman, CEO, Mercantile Bank Ltd, Md. Ahs

Tue, 01 Aug 2017 03:27:00 +0000

Md. Arfan Ali, Managing Director of Bank Asia Ltd. poses with the participants of the 5th EC and 1st General Meetings of SWIFT member and users group of Bangladesh at a hotel in the city on Wednesday. Kazi Masihur Rahman, CEO, Mercantile Bank Ltd, Md. Ahs

News:new nation/1-Aug-2017

BB resumes selling US dollar to stabilise exchange market

Mon, 31 Jul 2017 03:33:00 +0000

Demand for the greenback grows with rising imports

The central bank has resumed after one month the sales of US dollar to the commercial banks to provide them with foreign exchange support and stabilise the market, officials said.

As part of the move, Bangladesh Bank (BB) sold US$ 20 million at market rate to two commercial banks directly on Thursday to meet the growing demand for the greenback in the exchange market.

"We've sold the US dollar to facilitate the banks for making payments against import bills of petroleum products," a senior official at the BB told the FE.

He said the central bank might continue supporting the banks with the foreign currency subject to market requirement.

"We've provided such foreign currency support to the banks only for settling import payment obligations against food grains and fuel oils," he explained.

Earlier on July 25, the BB sold same amount of the US currency to a leading state-owned commercial bank for making payment of their food grains import bills.

In May last, it sold $21 million to the banks, according to the BB statistics.

The BB's latest move came against the backdrop of depreciation of the Bangladesh Taka (BDT) against the US dollar in both the inter-bank foreign exchange market and customers' end in the recent days.

The US dollar was quoted at Tk 80.65-Tk 80.66 in the inter-bank foreign exchange market on the day against Tk 80.64 on July 26, according to the market operators.

On the other hand, the exchange rate of the greenback for BC (bills for collection) selling rose to Tk 81.7338 Sunday from Tk 81.7326 of the previous working day.

It was Tk 81.7062 on July 26, according to the statistics of the Bangladesh Foreign Exchange Dealers Association (BAFEDA).

The country's foreign exchange reserve stood at $32. 84 billion Sunday, despite selling of $40 million to the commercial banks for settling import bills in the last week, according to another BB official.

"We expect that the inflow of foreign exchange may increase in the month following the upward trend of the inward remittance ahead of the Eid-ul-Azha," he said.

Bangladesh received $1.02 billion in remittances between July 1 and July 28 from expatriate Bangladeshi nationals who are working abroad. It may cross $1.10 billion by the end of July.

"But the flow of inward remittance may rise in the month of August ahead of the Eid," the BB official said.

Meanwhile, some banks are now holding sufficient amount of the greenback as the central bank raised substantially the net open position (NOP) limit of the banks last year, according to market insiders.

They said the banks are now following a 'go-slow' strategy for selling the greenback to the other banks.

"The banks believe that the exchange rate of BDT against the US dollar will depreciate further in the near future for making import bills of different commodities, particularly food grains," a senior treasury official of a leading private commercial bank explained.

He said the import of food grains might increase substantially in the coming months to meet the growing demand for the essential commodities in the domestic market.

The NOPs of all the 56 scheduled banks have been increased by more than 45 per cent to US$ 2.19 billion from previous $1.51 billion.

It was determined on the basis of 20 per cent of the total regulatory capital of the banks as on March 31, 2016, according to the BB officials.

News:Financial Express/31-jul-2017

Saudi central bank reserves up for 1st time

Mon, 31 Jul 2017 03:07:00 +0000

RIYADH: Saudi Arabia’s central bank reserves rose for the first time in over a year, even as low oil prices hinder government efforts to overall an economy dependent on energy exports.

Net foreign assets at the Saudi Arabian Monetary Agency increased to US$493.2 billion in June from $491.7bn in the previous month, according to a monthly report published on its website. It was the first increase since May 2016, according to data compiled by Bloomberg.

The rise is surprising, “especially given that the government’s deposits with the central bank continued to fall in the month,” said Monica Malik, the chief economist at Abu Dhabi Commercial Bank.

News:Daily sun/31-jul-2017

StanChart bullish on UAE despite slowing economy

Mon, 31 Jul 2017 02:52:00 +0000

DUBAI: Standard Chartered, the emerging market specialist bank, said the UAE is among the top markets for the financial institution despite the slowdown in the country’s economic growth.

Like Hong Kong and Singapore, the UAE is a trading hub with a large expat population, said Karen Fawcett, the head of retail banking for the London-based lender, reports The National.

“The UAE Singapore and Hong Kong are a group of markets which are very interesting to us because they are hub markets,” she told The National in an interview.

“They are special markets in terms of their trading hubs. They are places which attract a lot of expatiates to these financial centres. They attract a lot of the type of profile clients that we want and we’ve been in these markets for a very long time. It’s among our strong markets.”

Standard Chartered has faced tough times in many emerging markets since 2014, when the price of oil collapsed.

However, this year there has been an improvement in the economies of many developing nations, including the UAE where despite the economic slowdown there has been an amelioration in consumer banking.

Still, there are signs of ongoing pressure for the bank in the region.

And while the bank has not yet released its second quarter earnings, it said in April that operating income in the Middle East and Africa fell by 3 per cent in the first quarter amid currency devaluations in Africa and lower financial market income from the Middle East.

Operating income fell to US$686 million in the first three months of the year compared with $709m in the same quarter last year, the bank said.
And in November, the bank announced it was cutting 150 jobs in the UAE amid a lending slowdown.

That announcement was part of a wider cost-cutting plan announced in 2015 when the bank revealed plans to shed 15,000 jobs worldwide after years of losses, but it did not say at the time how many positions would be lost across its local operations.

The lender had been badly hit as the value of most commodities, which underpin the economies of many emerging markets including that of the Arabian Gulf, had fallen sharply.

Some of those commodity prices are starting to recover but the bank is not relying on a recovery of those prices alone and is taking measures to cut costs. This includes trimming its branch networks in an age when more of the affluent customers Standard Chartered is chasing eschew going to the bank and prefer to bank on their mobile phones.

Ms Fawcett said that banks now realise that with fewer people using branches that it is better to have smaller branches in key locations where people spend money, such as shopping malls.

“We’ve closed more than 10 per cent of our branches in the last two years,” Ms Fawcett said, “and rationalised about 30 per cent, shrinking, changing the format.

“Client behaviour is changing so we’re investing in the things that people want.” In May Shehzad Hameed, the head of retail banking at Standard Chartered in the UAE, said that sales of its retail products are growing at a strong pace that should stay that way all year long.

“Sales have had double-digit growth in the first quarter of the year,” Mr Hameed said. “We expect this to sustain throughout the year. Last year was a tough year for the retail business.”

In April, the global consultancy Alvarez & Marsal, in its inaugural report on the UAE banking sector, found increasing signs of recovery following the tough times.

“The good news is we are seeing signs of this downward cycle bottoming out,” said Saeeda Jaffar, the man-aging director at Alvarez & Marsal.

News:Daily sun/31-jul-2017

Islami Bank opens branch at Hemayetpur

Mon, 31 Jul 2017 02:45:00 +0000

Islami Bank Bangladesh Limited opened its 322nd branch at Hemayetpur of Savar.

Arastoo Khan, Chairman of the bank inaugurated the branch on Sunday as chief guest, said a press release.

Md. Joynal Abedin, Director of the bank addressed the program as special guest.

Delwar Hossain, Chairman, AKH Group, Aman Ullah Sarkar, Managing Partner of Lalon Group were present on the occasion.

News:Daily sun/31-jul-2017

SM Nazrul Islam, Head of General Services Division of First Security Islami Bank Limited, inaugurating its shifted Mohila Branch at College Road, Patiya in Chittagong on Sunday. Md. Wahidur Rahman, Chittagong Zonal Head and Mukti Chowdhury, Manager of the

Mon, 31 Jul 2017 02:37:00 +0000

SM Nazrul Islam, Head of General Services Division of First Security Islami Bank Limited, inaugurating its shifted Mohila Branch at College Road, Patiya in Chittagong on Sunday. Md. Wahidur Rahman, Chittagong Zonal Head and Mukti Chowdhury, Manager of the

News:new nation/31-jul-2017

NRB bank begins journey in Rajshahi

Mon, 31 Jul 2017 02:31:00 +0000

NRB Bank Limited has started journey with its 26th branch at Sultanabad area in the city on Sunday offering the best suite of credit cards with EMV Chip Security, says a press release.
The Managing Director and Chief Executive Officer Mehmud Hossain inaugurated the branch as chief guest. He hoped that the city dwellers would receive modern services of the bank and the branch will help promoting business and other commercial activities in the city.
He says NRB Bank offers full range of financial solutions to the small and medium enterprises for empowering sustainable growth.
"We are to be at your side when your growth vision is challenged by scarcity of fund. We are always ready to quick and easy loan processing, need based designing of financing solutions package with our experienced management team," Mehmud Hossain added.

News:new nation/31-jul-2017

SM Amzad Hossain, Chairman of South Bangla Agriculture and Commerce Bank Limited, inaugurating its 56th branch in Kushtia town on Saturday. Md Rafiqul Islam, CEO of the bank and local elites were present.

Mon, 31 Jul 2017 02:15:00 +0000

SM Amzad Hossain, Chairman of South Bangla Agriculture and Commerce Bank Limited, inaugurating its 56th branch in Kushtia town on Saturday. Md Rafiqul Islam, CEO of the bank and local elites were present.

News:new nation/31-jul-2017

Mercantile Bank focuses on SMEs

Sun, 30 Jul 2017 05:10:00 +0000

Mercantile Bank has shifted its focus on retail and SME banking instead of corporate lending, CEO Kazi Masihur Rahman said yesterday.

“We won't waste our time running after big clients. I have asked our officials to look for SME (small and medium enterprises) and retail customers,” he told journalists while disclosing the bank's half-yearly earnings at a programme at its headquarters in the capital.

As part of the move, he said the bank has segregated its branches based on corporate, SME and retail banking. It aims to disburse Tk 3,200 crore in loans to SMEs this year, up 60 percent year-on-year, he said.

Established in 1999, Mercantile Bank earned more than Tk 500 crore in operating profit for the first time last year. It went up to Tk 325 crore in this year's first half, up 42 percent from the same period a year ago.

“...now sky is the limit for us,” said Rahman. He said they were investing a huge amount of money on their IT wing to ensure security of customers. But, he declined to disclose the figure.

The bank's deposits and loans have increased 19 percent while overall import and export business 35 percent and 15 percent respectively in the first half of 2017.

Meanwhile, nonperforming loans of the bank went down to 4.31 percent from 5.13 percent in the corresponding period of the previous year. The industry average was more than 10 percent at the end of March this year.

Capital to risk weighted assets ratio of the bank stands at 12.07 percent, well above the regulatory ceiling of 10 percent.

The bank has 119 branches, 153 ATMs and 20 cash deposit machines across the country. It also has two fully-owned subsidiaries -- Mercantile Bank Securities Ltd and Mercantile Bank Exchange House (UK) Ltd.

The bank has 10.23 lakh deposit and 53,000 borrower accounts; its 1.76 lakh cards are active while nearly 4.75 lakh customers are using mobile banking services.

Growing business has increased its earnings per share to Tk 2.02 at the end of June this year from Tk 1.32 last year, said the CEO. Additional managing directors, deputy managing directors and other senior officials were present.

News:Daily star/30-jul-2017

AE Abdul Muhaimen appointed MD of UCB

Sun, 30 Jul 2017 05:00:00 +0000

Prior to that, he was the Additional Managing Director of UCB

AE Abdul Muhaimen has been appointed as the Managing Director of United Commercial Bank Limited (UCB).

Prior to that, he was the Additional Managing Director of UCB.

Abdul Muhaimen is a senior banking professional with 30 years of experience with multinational corporations and regional banks in Asia, Australia, Middle East.

Mr. Muhaimen have also held Board positions as a Director on the Boards of Brac EPL, Brac EPSL, bKash and IIDFC in Bangladesh.

News:Dhaka Tribune/30-jul-2017

Central bank sees S Africa exiting recession

Sun, 30 Jul 2017 04:51:00 +0000

JOHANNESBURG: South Africa's central bank chief said Friday the country was expected to have emerged from its first recession for eight years during the second quarter of this year.

Africa's most advanced economy unexpectedly contracted in the first quarter of this year, slipping into its first recession since 2009, reports AFP.

"We believe that the worst is behind us -- and that growth in the second quarter of this year will be positive," said central bank governor Lesetja Kganyago.

The bank forecasts the economy to grow by 0.5 percent this year, which it expects to rise to 1.5 percent in the next two years.

News:Daily sun/30-jun-2017

Russian central bank keeps key rate at 9pc

Sun, 30 Jul 2017 04:46:00 +0000

MOSCOW: Russia's central bank hit the pause button on rate cuts Friday, deciding to hold off following three consecutive reductions amid a slight uptick in inflation.

The bank insisted "short-term and mid-term inflation risks persist" as it announced in a statement that it was sticking at the present 9.0 percent rate.

It said, however, that it is looking to resume its policy of lowering the rate to revive economic growth and "sees room" for cuts "in the second half of 2017", reports AFP.

"While making its decision hereinafter, the Bank of Russia will assess inflation risks, the inflation dynamics and economic developments against the forecast," it added.

Russia's central bank hiked rates sharply in late 2014 as the Russian economy buckled under the double-whammy of the collapse in oil prices and Western sanctions over Moscow's meddling in Ukraine. Ever since it has proceeded cautiously with easing the rate, championing a "moderately tight monetary policy" against a background of economic uncertainty.

News:Daily sun/30-jul-2017

City Bank, FMO hold training course

Sun, 30 Jul 2017 04:35:00 +0000

Bangladesh Bank Executive Director Ahmed Jamal and City Bank Managing Director and CEO Sohail RK Hussain are seen at a training course organised by FMO and City Bank at City Bank’s head office in the capital on Saturday.

City Bank and FMO, a Dutch Development Bank, jointly organised a two-day long interactive training session on ‘Commodity Price Risk Management’ in association with Euromoney Learning Solutions at City Bank head office.

Ahmed Jamal, Executive Director of Bangladesh Bank, Sohail RK Hussain, Managing Director and CEO of City Bank and Elisabeth Wegen, Senior Analyst, Financial Institutions of FMO inaugurated the programme on Saturday, said a press release.

Among others, Rahel Ahmed, DMD, Prime Bank, Sheikh Mohammad Maroof, DMD, City Bank, Mahia Juned, DMD, City Bank were also present.

The training has been participated by senior officials from Bangladesh Bank, City Bank, FMO and other leading commercial banks of the country.

The training is being conducted by Emma Jenkins, an experienced trainer from Euromoney who has years of experience on commodity markets specializing in derivative pricing, structuring, and loan origination.

News:Daily sun/30-jul-2017

Jamuna Bank inks deal with Hotel Sea Crown

Sun, 30 Jul 2017 04:26:00 +0000

Jamuna Bank Deputy Managing Director AKM Saifuddin Ahamed and Hotel Sea Crown Managing Director SM Sayeedul Haque exchange documents after signing an agreement at Jamuna Bank head office in the city recently.

Jamuna Bank Limited and Hotel Sea Crown signed a mutual agreement at Jamuna Bank head office in the city recently.

Deputy Managing Director of Jamuna Bank Limited AKM Saifuddin Ahamed and Managing Director of Hotel Sea Crown SM Sayeedul Haque signed the agreement on behalf of their respective organizations, said a press release.

News:Daily sun-30-jul-2017

SBAC Bank opens branch in Feni

Sun, 30 Jul 2017 04:15:00 +0000

South Bangla Agriculture and Commerce Bank Chairman SM Amzad Hossain inaugurates a new branch of the bank at SSK Road in Feni recently.South Bangla Agriculture and Commerce (SBAC) Bank opened its 55th branch at SSK Road in Feni recently.

SM Amzad Hossain, Chairman, Board of Directors of SBAC Bank inaugurated the branch as chief guest, said a press release.

Among others Maksudur Rahman, Chairman, Risk Management Committee of SBAC Bank Ltd, Md. Rafiqul Islam, Managing Director and CEO of SBAC Bank, Md.

Golam Faruk, Senior Additional Managing Director of SBAC Bank were present.

Moreover local elites were also present on the occasion.

News:Daily sun/30-jul-3017

$570m WB loan for health service, public procurement

Sun, 30 Jul 2017 04:04:00 +0000

The World Bank (WB) on Saturday approved a credit to provide a total of US$ 570 million to Bangladesh for two projects to improve health, nutrition and population services, and strengthen the country's public procurement.
These two projects will help further progress towards better health outcomes and optimal use of public resources through an effective public procurement and monitoring system, said a WB press release.
"The World Bank and the government have been working together for years to improve the health sector and public procurement performance," said Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal.
The US$ 515 million Health Sector Support Project will strengthen the country's health system and improve quality and coverage of essential service delivery, with a focus on Sylhet and Chittagong divisions, where key health indicators are below the national average.
It aims to increas the number of mothers receiving quality delivery care in public health facilities to at least 146,000 mothers annually in Sylhet and Chittagong divisions. It will also provide basic immunization to nearly 5 million children.
As the country experiences demographic changes, the project will help address emerging health challenges, such as non-communicable diseases.
In Sylhet and Chittagong divisions, it will support school-based adolescent health and nutrition services.
The project will also help improve financial management and procurement in the sector and develop a robust health information system. It will enable over 7000 community clinics to provide complete essential data on service delivery, and ensure at least 150 health facilities to each have two accredited midwives.
The financing will contribute to the government's US$ 14.7 billion health sector program between 2017 and 2022. It includes a US$ 15 million grant from the Global Financing Facility to improve service delivery for reproductive, maternal, newborn, child, and adolescent health and nutrition.
The other financing approved today, the US$ 55 million Digitizing Implementation Monitoring and Public Procurement Project, will help Bangladesh improve public procurement performance, including its capacity to monitor implementation of development projects and programs using digital technology.
Bangladesh spends over US$ 7 billion yearly on public procurement, which constitutes about 70 percent of the annual development program.
The WB helped Bangladesh roll out electronic procurement (e-GP) in four key public procuring entities in 2011, and establish a high capacity data center in 2016 to accommodate increasing demand for electronic procurement. The new project will expand e-GP to all 1300 government procuring organizations.
The credits are from the International Development Association (IDA), the World Bank's concessional lending arm. The credits are interest-free and repayable in 38 years, including a six-year grace period, and carry a service charge of 0.75 percent.

News:new nation/30-jul-2017

Md Abdul Hamid Miah, Managing Director of Islami Bank Bangladesh Limited, addressing the 'Business Development Conference of Mymensingh Zone' on Friday at BRAC-CDM auditorium in Gazipur.

Sun, 30 Jul 2017 03:56:00 +0000

Md Abdul Hamid Miah, Managing Director of Islami Bank Bangladesh Limited, addressing the \'Business Development Conference of Mymensingh Zone\' on Friday at BRAC-CDM auditorium in Gazipur.

News:new nation/30-jul2017

Md. Ahsan-uz Zaman, Managing Director of Midland Bank Limited, Mahmood Malik, Executive Director of Infrastructure Development Company Limited and Md Motiur Rahman, Managing Director of Kushiyara Auto Bricks Limited signing a tripartite agreement at the b

Sun, 30 Jul 2017 03:44:00 +0000

Md. Ahsan-uz Zaman, Managing Director of Midland Bank Limited, Mahmood Malik, Executive Director of Infrastructure Development Company Limited and Md Motiur Rahman, Managing Director of Kushiyara Auto Bricks Limited signing a tripartite agreement at the b

news:new nation/30-jul-2017

Md. Mahbubur Rahman Khan, Director of National Bank Limited, inaugurating an ATM booth at Goalchamat branch, Faridpur on Thursday. Md. Mahfuzur Rahman, Executive Vice President and Head of Card Division was also present.

Sun, 30 Jul 2017 03:32:00 +0000

Md. Mahbubur Rahman Khan, Director of National Bank Limited, inaugurating an ATM booth at Goalchamat branch, Faridpur on Thursday. Md. Mahfuzur Rahman, Executive Vice President and Head of Card Division was also present.

News:new nation/30-jul-2017

'Unofficial terms' stand in way of PKB loans for migrant workers

Sat, 29 Jul 2017 07:25:00 +0000

Officials ask for land documents as collateral

Many outbound workers are facing difficulties in getting loans from the Probashi Kallyan Bank (PKB) due to 'unofficial conditions' and indifferent attitudes of bank officials, migrant workers have alleged.

Although there is no mention about submitting land documents as a condition for availing any migration loan from the PKB, its different branches are demanding the same from the borrowers.

Besides, the PKB officials are asking the migrant workers to make government service holders guarantors of the loans. This requirement is also not mentioned in terms and conditions set for PKB loans, they said.

Talking to the FE, a large number of foreign job aspirants highlighted these problems with getting the loans.

Some of them said, it is almost impossible to get a loan from the specialised bank without lobbying.

However, officials of the PKB denied the allegations about the loan disbursement system and said because of manpower shortage, they could not provide proper services at its different branches.

Of the total 45 branches across the country, 30 are running with one manager and one office assistant.

The remaining branches also have no sufficient manpower.

The PKB officials, however, said the problem would be resolved shortly. After the bank's conversion as a scheduled bank, its services to the migrant workers will be expedited, they said.

Wishing anonymity, a migrant worker, who went to the Jamalpur branch of the PKB, said he faced sufferings as officials asked him for his land document and a lot of papers for a migration loan.

"Even I am forced to lobby for the loan," he said. Officials misbehave with poor and weak job-seekers, he added.

He also did not get any grace period in repaying instalments of the loan as mentioned in the PKB terms, he said.

Ali Hossain, brother of a migrant worker, said they completed all procedures as per the requirements of the PKB. But officials of its Comilla branch refused to provide the loan to his brother without any land document and a government service holder as a guarantor.

"My brother needs Tk 450,000 to go to Qatar. At last, we collected the money from a village money-lender at a high interest rate," he mentioned

Milon, another outbound worker, said he went to the Narayanganj branch of the PKB to get a loan.

But officials told him that Oman-bound workers would not get any loan from the PKB. "I did hard work to collect all necessary papers," he added.

Some workers, who visited the same branch, also claimed they were forced to give Tk 10,000 each to an intermediary to get loans. The agent is employed by the branch.

Official statistics showed that less than one per cent migrant workers received migration loans from the PKB in the fiscal year (FY) 2016-17.

According to the PKB, the number of migration loan beneficiaries was 6,304 out of 904,297 who migrated abroad in the last FY.

The PKB started its operation in April, 2011 with a capital of Tk 1.00 billion (100 crore) aiming to provide collateral-free loans to overseas job-seekers and to give loans for rehabilitation of returning workers in income-generating activities.

Of the total fund, the Wage Earners' Welfare Board provided Tk 950 million and the finance division of the government provided the remaining Tk 50 million.

Migrant rights activists said it is very unfortunate that migrant workers are not getting due support from the bank.

If the PKB fails to provide necessary loans, poor workers will be forced to go to money lenders to arrange the cost of migration. The authority should take proper initiatives to check all irregularities in providing loans to the migrant workers, they suggested.

Ovibashi Karmi Unnayan Programme (OKUP) chairman Shakirul Islam said the PKB was established to provide collateral-free and low-cost loans to the migrant workers but the bank has failed to meet the requirements.

It is a tough job for a migrant worker to submit land documents as many of them are landless. So, many workers will fail to avail the loans. The authority should check such a malpractice, he said.

He also said rates of interest against the PKB loans are very high. It is not suitable for workers as they are from lower-income group. The interest rate should not be more than 2.0 to 3.0 per cent, he observed.

He also said returning workers usually can't fulfil the conditions set for availing income-generating loans of the PKB.

After turning of the PKB into a scheduled bank, it is necessary to make the terms on collaterals for income-generating loans simple, said Mr Islam.

The rate of interest is now 9.0 per cent on migration loans and 11 per cent on income-generating loans. The maximum limit of a migration loan is Tk 200,000 for one person.

Faruque Ahmed, secretary general of the WARBE Development Foundation, said it has become difficult to get loans from the PKB because of unofficial conditions.

A large number of workers, who applied for loans with the help of WARBE Development Foundation, failed to receive the funds, he added.

When contacted, PKB managing director ANM Masrurul Huda Siraji said he did not get such complaints so far. He said he would order investigation into various complaints.

But the PKB maintains the condition on guarantor strictly to help recover the loans, he said.

He also said there is a manpower shortage in different branches. So, loan disbursement activities are being hampered. Already the central bank has issued a circular to employ officials in the PKB as per organogram of the bank.

He also said after conversion of the PKB as a scheduled bank, they will be able to expedite their loan services to the clients. Presently, the bank can disburse loans to only a few persons.

Replying to a query, the PKB MD said all migrant workers are entitled to get migration loans. But the bank gives first priority to the workers whose visas are available online to check.

"So there is no reason to refuse a loan to any worker," he added.

Since its operation, only 23,731 outbound Bangladeshi workers were given loans worth Tk 2.29 billion by the bank from fiscal year 2011-12 to 2016-17, according to official data.

Of the total beneficiaries, some 156 returnees received loans for income-generating projects at home. During the period, the bank recovered Tk 1.55 billion.

Meanwhile, the government recently decided to give Tk 2.50 billion to the PKB for turning it into a scheduled bank. The Wage Earners' Welfare Board has also given Tk 500 million to the bank to help raise its paid-up capital to Tk 4.0 billion.

News:Financial Express/29-jul-2017

Most bank boards ignorant of cyber risks, finds study

Sat, 29 Jul 2017 07:05:00 +0000

Only 3.0pc CROs charged with managing exposures

A significant section of the country's banks and their governing bodies are not sure about what their major cyber threats are, a recent industry-wide survey on cyber risk governance has revealed.

The survey also found that 45 per cent of the bank boards do not know what the single biggest technology or cyber security vulnerability is, while 42 per cent of the banks do not know what their largest potential cyber risk exposures are.

Around 76 per cent of the country's banks do not explicitly know legal implications of cyber risks for their institutions.

Even though cyber risk is included in the Risk Management Framework (RMF) of around 82 per cent of the banks, further insight reveals that such integration remains largely 'on paper'.

The findings have emerged during a cyber risk governance survey conducted recently on the Chief Risk Officers (CROs) of the country's banking institutions.

Leading banking research body 'Bangladesh Institute of Bank Management (BIBM)' conducted the survey.

It was found from the survey results that 58 per cent of the bank CROs responded with either a 'No' or 'Sometimes' when they were asked ' Is Cyber Risk considered explicitly as distinct Material Risk Type' in their institutions.

"This shows that although cyber risk is integrated in risk management at a policy level, in practice, this is perhaps often not the case", said Sajib Azad, Senior Advisor of BIBM.

Mr Azad, who brings with him experience of working with the European Central Bank and the Bank of England, conducted the survey along with Director General of BIBM Dr.Toufic Ahmad Choudhury.

"Additionally, the 'Sometimes' response also tends to indicate that when cyber risk is discussed, it is discussed largely in terms of incident management or on an ad-hoc basis", he added.

Analysts also observed that the responses of the survey indicate the lack of depth in the overall cyber risk management of the country's banks.

For example, it was found that only 3 per cent of the CROs are charged with managing cyber risk exposures.

This probably shows that cyber risk is seen 'merely as a technology or IT risk' in our banks, experts said, which makes it challenging for the banks to identify the real business risk it poses.

Previously an overlooked topic in Bangladesh's banking industry, cyber risk issues are now gradually gaining attention after the US$ 101 million central bank heist of last year.

The survey on the Chief Risk Officers, however, shed a new light on the cyber risk framework and related governance issues within the banks.

The findings of the survey are set to be shared during the next Chief Risk Officers' forum of BIBM scheduled on August 30.

When asked what is the most substantial challenge in improving cyber risk management in the banks, most of the respondents pointed their fingers to the 'limitations of the current system'.

In addition, 'access to the requited technical know-how' and most notably, 'senior management's interest' have also been identified as major obstacles.

"Perhaps lack of senior management's interest is a result of seeing cyber risk as an IT issue rather what it is: a critical business issue", said Dr. Toufic Ahmad Choudhury, Director General of BIBM.

"The fact that 48 per cent of the respondents do not know which systems not to bring back-up quickly further supports the theme that cyber risk is viewed narrowly as in IT risk and has limited traction with the wider bank and governance elements", he added.

As a way-out for the prevailing condition, experts called for developing greater awareness across the banking industry as well as developing a culture of taking pre-emptive action against cyber risks within the banking institutions.

"The first step in this regard is to develop a cyber security policy and crisis management plan", Mr Azad said adding that this needs to be collectively understood, taken seriously and enforced by the leadership.

"The critical thing is to create cyber security awareness among not only IT personnel of the banks but among all employees of a financial institution", Toufic Ahmed Chowdhury said.

News:Financial Express/29-jul-2017

Ali Reza Iftekhar, Managing Director of Eastern Bank Limited, presenting a bouquet to Dr. Shirin Sharmin Chaudhury, Speaker of National Parliament for being a guest speaker of 'EBL Leadership Lecture Series' program at EBL Capacity Enhancement Center in t

Sat, 29 Jul 2017 06:44:00 +0000

Ali Reza Iftekhar, Managing Director of Eastern Bank Limited, presenting a bouquet to Dr. Shirin Sharmin Chaudhury, Speaker of National Parliament for being a guest speaker of \'EBL Leadership Lecture Series\' program at EBL Capacity Enhancement Center in

News:new nation/29-jul-2017

Trade risk management in banks

Sat, 29 Jul 2017 06:30:00 +0000

Payments as well as the delivery of goods in international trade is challenging with huge involvement of risks. Risks in the international trade are mostly related to the trade payment and financing activities considering the fact that these are the major activities of international banking in Bangladesh. Most of the cases the risks are related to non-compliance of regulation or guidelines. In Bangladesh, trade services products are those services that are commonly offered from the 'Trade Services Department' of a bank. In broader sense, trade services products of Bangladesh includes products or services related to trade payment and trade finance.
Many types of risks are involved in the trading of goods and some of these risks will affect domestic trade, they are generally amplified in international trade. The most common trade risks includes finance related risk, payment related risk, documentation risk, economic risk, foreign exchange risk, interest rate and price risk, crime and money laundering risk, buyer's insolvency/credit risk, buyer's acceptance risk, knowledge inadequacy, seller's performance risk, country risk, cultural risk, legal risk, political and sovereign risk and transit risk. Common Trade Risks in Banks are described below:
In LC operations, late payment has been found to be a common practice by the trade service providing banks. In spite of receiving compliant documents under sight LCs, the payments have been lingered which don not only harm the institutional reputation but also the image of Bangladesh. The applicants request the banks to lodge discrepancy notices to halt the payment momentarily on the grounds such as goods had not arrived or goods were of inferior quality. The applicants also approach the issuing banks to linger payment through issuing discrepancy notices in spite of the arrival of consignment. Banks are also cooperating with them in some instances which also inflate the confirmation charges of the LCs issued from Bangladesh. This practice creates huge country risk as well as reputational risk with counterparts.
In the context of Bangladesh, there are instances where banks reject documents just for rejection and charges for the discrepancies as their foreign counterparts do. These are clear departures from the UCP morals. Such practices can simply make the trades costlier and burdensome to the consumers generating economic and other associated risks.
These practices along with sudden price decrease in global market are creating forced loan, rescheduling and converting non-funded liability into funded liability in Bangladesh. In some circumstances, banks also delay payment to protect their interest which is undesirable under UCP rules. And this scenario creates both credit risk/default risks and liquidity risk for banks also.
For making the payment under local Back to Back LCs (denominated in FC) there are two alternatives for banks i.e. Nostro Accounts (using swift MT 202) or they can use the FC Clearing Account maintained with Bangladesh Bank. Many banks are utilizing the services of foreign correspondent abroad as the payments are affected through the Nostro Account which is maintained with them which results in FC outflow in the form of charges from Bangladesh just to gain in business with the correspondent agents resulting in higher revenue in the form of charges which may create legal risk and non-compliance risk as well.
In banking industry of Bangladesh, some instruments trade like LCs or guarantees are used for fraudulent or unethical practices in performing local trading activities. The issue of accommodation bill (payment without genuine consignment) related with shipment under local LCs is severe concern augmenting various risks including delivery risk of the consignments.
Most of the local banks in Bangladesh, for domestically transferred and transferable LCs transfer through endorsement on the back of the master LCs which raises the scope for fraudulent practices and forgery.
As per BB Guidelines on Foreign Exchange Transactions (GFET-2009) banks are required to obtain confidential reports for opening of an LC on foreign exporters where amount exceeds USD 10,000 and USD 20,000 against proforma invoices and against intents issued by local agents of suppliers respectively. Banks are issuing LCs without obtaining credit reports only incorporating credit report clauses which is a sheer violation of the GFET and obviously raises the risks of both the issuing bank and the importer.
To retain the clients in this competitive market, some banks (a few instance) are sometimes undertaking undue risks even bypassing the regulatory framework, e.g. financing by the Ads to the exporters through opening back to back LCs (deferred by 180 days) upon open account trade which could be extremely risky if the foreign buyers default or do not make payment. Mentionable, as the associated ADs are endorsing the transports documents (title to the goods) to the foreign buyers directly, it could prove to be very risky.
Insurance coverage is supposed to be offered by the importers in Bangladesh. Banks are supposed to ensure minimum insurance coverage of 110 per cent of importable at the time of opening LCs. But some banks open LCs are opened ensuring only 100 per cent of the importable. Hence, breach of Bangladesh Bank rules is very apparent creating huge risk exposure of the Bank.
In case of importing restricted items that require permission from the appropriate authority issuing banks are suppose to incorporate the documents as well as certain conditions. In general, documents are asked for but conditions are not incorporated exposing banks in documentation risks.
Some banks make payments as per the requirement of LCs but goods never arrived and banks are in trouble. Such instances are found where sight LCs is issued with TT reimbursement clause by a Bangladeshi bank and the scenario exposes huge risks.
Risks also prevail in banks in the area of non-realization of export proceeds. Banks are expected to behave responsibly and report to Bangladesh Bank within stipulated time. But there are instances where ADs of banks do not report to Bangladesh Bank and also banks cooperate with the exporters in fraudulent activities holding reporting risks also.
As per the directives of BB, the banks are absolutely prohibited from engaging themselves in transactions with speculative motives in respect of FX market but some treasuries of banks hedge the risks of the clients through options and so not report to evade the possible difficulties. Transactions on option require case to case approval from Bangladesh Bank. Earning profit and collection of charges are the main objectives behind these malpractices resulting new risk dimension for the entire banking industry.
Sometimes banks in Bangladesh do not renew the guarantee requirement for continuing with inward remittance services. Some banks have undue practices in mobilizing inward remittance through exchange houses, for which Bangladesh Bank can duly penalize them. In maintaining FX accounts, some irregularities are there mainly due to the knowledge gap of the bankers.
Four techniques of Trade Based Money Laundering (TBML) i.e. over and under invoicing of goods and services; over and under shipment of goods and services; multiple invoicing; and falsely described goods and services. In Bangladesh over and under invoicing of goods and services, and falsely described goods and services are common in use for money laundering. To hide or profitable use of the proceeds of crime through illicit outflows of funds from Bangladesh the criminals use over pricing in imports, generally low duty item like capital machineries, raw materials and spare parts and under pricing of export. For gaining government benefit like cash incentives, subsidies there are tendencies of over pricing of exported items wherein collected wage earners' remittance is used to fill the rest of the export proceeds.
Sanctions clause is commonly found in the LCs received from abroad. Now-a-days the local have also started inserting Sanction clause in their LCs issued from Bangladesh which do not match with the expectation of the approach of ICC. These types of clauses may offer negative perception at the initiation of the transactions.
International trade exposes exporters and importers to substantial risks. To mitigate these risks, firms can buy special trade finance products from banks. Major ways to mitigate trade risk in banks are described below:
Minimising risks through precautionary measures: Importers and exporters can take precautionary measures to avoid or minimize some trade risks wherein banks can play a pivotal role. For example, in order to avoid quality issues before they arise, importers should research the quality of the products and verify the general reputation of the seller before the placement of an order.
Negotiating the right type of payment and credit terms: The question of when and how a payment is made will determine how the counterparty risk is distributed between the exporter and the importer. In this sense the negotiation of favourable payment and credit terms or the use of risk mitigating payment instruments is an important element of the management of counterparty risks in trade.
Introduction of modern communication and service rendering devices in the foreign exchange department: In various facets of import financing, modern IT devices should be introduced for increasing overall efficiency of the service. Communication of letter of credit to the negotiating banks, negotiation regarding LC conditions, conformation of letter of credit and payment of import bills are the areas where modern IT devices should be employed specially in those banks where there exist room for improvement.
Developing hearty banking relationship with foreign banks in important parts of business world: For handling import trade systematically and effectively, there is a need for developing sound relationship with foreign banks which can operate as negotiating banks for the bank issuing letter of credit. This relationship building can facilitate prompt handling of import operations including the payment aspects.
Strict adherence to Bangladesh Bank guidelines in processing import financing: The foreign exchange department of the bank must follow the Bangladesh Bank guidelines strictly to avoid any future problem in the management of import financing. Bank officials dealing in foreign exchange must be thoroughly conversant with these rules and in evaluating application for letter of credit. All points must be examined with utmost care and prudence. This may also help to protect national interest.
Strengthening advisory services by the bank for the new and inexperienced import firms: New and inexperienced import firms experience problems in handing various aspects of import financing. These firms need sound advisory services from banks to handle all technical aspects precisely. Bank officials in the foreign exchange department can work as helping hand to assist these firms. For this purpose, technically sound team must work in the advisory cell of the foreign exchange department of the bank.
Credit insurance: Credit insurance is an alternative to letters of credit, which can be expensive and time-consuming. Credit insurance protects the exporter from the risk of default by the importer. Credit insurance can cover specific circumstances such as the importer's bankruptcy, refusal to pay or country risks such as political upheaval. It is possible to insure all of a supplier's clients or simply specific customers or transactions.
Factoring: Factoring is limited as a mitigation instrument for trade risks in Bangladesh. Factoring firms that offer international factoring and if non-recourse factoring is employed the factor takes on the credit risk of all trade receivables which can be initiated in banking industry of Bangladesh
Forfaiting: Forfaiting is carried out on a non-recourse basis because the instrument sold is an obligation of the customer which also enables exporters to trade in higher risk countries although the higher risk will be reflected in the cost. Forfaiting can be expensive to arrange as the company will have to pay for the financing arrangement and the guarantee, henceforth proper care should be adopted before taking this strategy.
Supplier finance: Supplier finance, also known as reverse factoring, is initiated by the buyer (not the seller), typically to extend payment terms without damaging the supplier relationship or the ability of the supplier to deliver in time. In supplier finance, a bank in Bangladesh can pay the exporter as soon as the importer has confirmed the invoice. The bank will be repaid later by the buyer. Supplier finance can be offered on a non-recourse basis, which means that the exporter is not liable for non-payment by the importer.
Both exporters and importers have to decide which risks to tolerate and which risks to manage. Ultimately a cost-benefit analysis must determine which instrument is best suited to mitigate the identified trade risks. Hence, the banks in Bangladesh can play advisory roles in expanding trade literacy among the traders which will ultimately benefit them in handling trade business. Moreover, a company's specific situation with regard to financing needs and customer relationships must be taken into account while addressing the trade risk mitigation although in most cases not all trade risks can be mitigated. However, all required strategies must consolidated to obtain both short term and long term benefits in international trade business for a forward moving country like Bangladesh.
The writer, a banker by profession is a Certified Expert in Risk Management (CERM) from Frankfurt School of Finance, Germany. The views expressed in the article are the writer's own and not necessarily the organization he represents.

News:new nation/29-jul-2017

Bank of England appoints new Deputy Governor

Sat, 29 Jul 2017 06:23:00 +0000

The Bank of England has picked senior civil servant and Treasury veteran Sir Dave Ramsden as its new deputy governor for markets and banking, it said Thursday.
The appointment of Ramsden, 53, brings the British central bank's interest rate-setting Monetary Policy Committee back to its full complement of nine members.
Ramsden, who led government work on whether Britain should join the euro at the turn of the century, has been a Treasury representative at MPC meetings for a decade.
"I am honoured to be joining the Bank and to be given the opportunity to contribute to the Bank's mission to maintain monetary and financial stability, at such an important time for the UK economy," said Ramsden, who will take up his role in September.
Back in March, the BoE's previous deputy governor, Charlotte Hogg, resigned after failing to declare that her brother worked for commercial banking giant Barclays. She stepped down just two weeks into the job.
Sir Dave joined the civil service in 1986, subsequently joining the Treasury in 1988 and currently acts as its chief economic adviser.

News:New nation/29-jul-2017

Dr. Zayed Bakht, Chairman of the Board of Directors of Agrani Bank Limited, handing over a cheque of Tk 1 lakh to Hafez Mohammad Tariqul Islam who secured first place in the International Quran Competition among 103 countries in Dubai from Markazut Tahfiz

Sat, 29 Jul 2017 06:12:00 +0000

Dr. Zayed Bakht, Chairman of the Board of Directors of Agrani Bank Limited, handing over a cheque of Tk 1 lakh to Hafez Mohammad Tariqul Islam who secured first place in the International Quran Competition among 103 countries in Dubai from Markazut Tahfiz

News:new nation/29-jul-2017

Md Abdul Halim Chowdhury, Managing Director of Pubali Bank Ltd, addressing a training course on 'Foundation Training for Probationary Officers' at its training institute recently. Niranjan Chandra Gope, Principal of Pubali Bank Training Institute, preside

Sat, 29 Jul 2017 06:01:00 +0000

Md Abdul Halim Chowdhury, Managing Director of Pubali Bank Ltd, addressing a training course on \'Foundation Training for Probationary Officers\' at its training institute recently. Niranjan Chandra Gope, Principal of Pubali Bank Training Institute, presi

News:new nation/-jul-2017

Farman R Chowdhury, Managing Director of Shahjalal Islami Bank Limited, poses with the participants of a 15-day long 'Foundation Training Course' for the newly recruited Management Trainee Officers of the bank at its training institute recently.

Sat, 29 Jul 2017 05:53:00 +0000

Farman R Chowdhury, Managing Director of Shahjalal Islami Bank Limited, poses with the participants of a 15-day long \'Foundation Training Course\' for the newly recruited Management Trainee Officers of the bank at its training institute recently.

News:new nation/29-jul-2017

BB lowers private sector credit target

Thu, 27 Jul 2017 05:16:00 +0000

‘We have set 15.8% as domestic credit growth because the credit flow in the last fiscal was lower than the set target’

The target was 16.5% in the second half of the last fiscal year, which ended on June 30.

After discussing with stakeholders and economists, BB Governor Fazle Kabir announced the monetary policy at the central bank’s headquarters on Wednesday.

He said the bank was targeting 12.1% credit growth in the public sector and an overall domestic credit growth ceiling of 15.8%.

“We have set 15.8% as domestic credit growth because the credit flow in the last fiscal was lower than the set target,” the governor said.

The credit growth has only been lowered for the public sector, not the private sector.

The Exporters Association of Bangladesh (EAB) president, Abdus Salam Murshedy, was critical of the central bank policy.

“Both the exports earnings and private sector investment growth are showing little growth, but Bangladesh Bank has contracted the credit growth target in its monetary policy for the next six months,” he told the Dhaka Tribune.

“If Bangladesh Bank increases the credit growth, it will encourage both banks and investors to disburse more and expand businesses.”

When journalists at on Wednesday’s event asked the governor whether the MPS is contractionary, since the credit growth target has been lowered, the response came from a deputy governor.

Deputy Governor SK Sur Chowdhury replied: “The recent rise in foodstuff prices are an omen for inflation. Hence we have set the domestic credit growth target at 15.8% (but) it will be adjusted if needed.”

Fazle Kabir said the policy will help the Bangladesh economy to achieve 7.4% GDP growth at the end of the current fiscal year, while limiting the inflation rate to 5.5% as per the government target in the budget for this fiscal year.

The inflation rate at the end of last FY stood at 5.4% against the pre-set target of 5.8%.

The governor also suggested that in order to meet the budget deficit, the government should increase borrowing credit for state-owned banks, and cut dependency on national savings certificates by lowering the existing interest rate on NSCs and fixing a ceiling for their sales.

News:Dhaka Tribune//27-jul-2017

De-risking batters nine banks, the syndrome may spread

Thu, 27 Jul 2017 05:04:00 +0000

More banks fear overall profitability slide for such action against money laundering

At least nine local banks have been battered by newly-invented 'de-risking' strategy to combat money laundering that may also affect profitability of other local banks.

Such official findings stem from the national action plan mandated by an international combat against money laundering and terror financing.

"Some other local banks have also been affected by the de-risking," Abu Hena Mohammad Razee Hassan, Deputy Governor of Bangladesh Bank (BB), disclosed while replying to a query about the impact on de-risking of Bangladesh.

The term 'de-risking' refers to financial institutions closing the accounts of clients perceived high risk for money laundering-or terrorist-financing abuses, namely money service businesses, nonprofit organisations, correspondent banks, and foreign embassies.

The central bank of Bangladesh has already advised the global banks through their local offices or representatives to inform the Bangladesh Financial Intelligence Unit (BFIU) of the central bank before cutting ties with local commercial banks, said Mr. Razee Hassan, also head of the BFIU.

"The issue has already been discussed at FATA (Financial Action Task Force) and APG (Asia Pacific Group on Money Laundering) recent meetings," the BFIU chief noted.

Among the nine local banks, five are state-owned commercial banks while one is a Shariah-based Islamic bank and three other conventional local private commercial banks. They have been designated as the mostly affected banks of Bangladesh, according to a BB senior official.

Currently, 49 local banks are running their operations across the country. He also said the BFIU has urged the global banks to review the corresponding relationship discontinuation with the local banks.

"Some corresponding relationships had been discontinued on the basis of media reports," the official said in reply to a query.

Adverse impacts of de-risking increased further in 2016, affecting 60 per cent local banks as against 53 per cent a year before. It was 60 per cent in 2014, according to a study conducted by the Bangladesh Institute of Bank Management (BIBM).

Contacted, Shah Md. Ahsan Habib, professor and director of the BIBM, said the profitability of banks may be hampered following adverse impacts of the de-risking drive.

"Cross-border transactions and remittance business of the banks have been affected due to the de-rising," Dr. Habib explained. He also urged the banks to take effective measures to improve compliance capacity of AML/CFT for avoiding such negative impacts.

"Workers' remittance inflows are suffering downturn not just because of weakened demand for migrant workers in major migrant labour-hosting countries but also because it is getting harder, even impossible in some instances, for migrant workers to access legitimate channels for sending money home, with high-cost burdens of compliance with unduly stringent AML/CFT regulations dissuading international banks from relationships with remittance-handlers," the central bank said in its latest monetary policy statement (MPS), released Wednesday.

It also said: "Urged repeatedly in global dialogues, inter alia by the BB and other Bangladesh authorities, global AML/CFT standard-setters are now reportedly looking into this."

The inflow of remittances dropped by 14.48 per cent to US$ US$12.77 billion in the fiscal year (FY) 2016-17 from $14.93 billion a year ago.

News:Financial Expres/27-jul-2017