BB to unveil new flagship monetary policy statement on July 30
Efforts on to bring back discipline in banking sector, says Atiur
UNB
Bangladesh Bank governor Atiur Rahman yesterday said the central bank is trying to bring back discipline in the banking sector but it has not got everything in its hand in dealing with non-performing loans or irregularities in the sector, reports UNB.
Were trying our best to bring back discipline in the banking sector, but everything is not in our hands, he told reporters while addressing a consultation meeting at a city hotel with economic reporters about the coming 6-monthly monetary policy scheduled to be declared at the end of the current month.
The central bank governors came up with the remarks against the backdrop of the economic reporters concern about the rise of non-performing loans and also about failure of taking punitive action against irregularities in the countrys banking sector.
As of September 2014, the countrys average non-performing loan from banks is 12.79 per cent against the global acceptable limit of 2-3 per cent. Of them, the bad category of classified loans, which is not recoverable, constitutes about 70 per cent.
According to a Bangladesh Bank study, the NPL rate was 28.76 per cent in state-owned banks, 29.39 per cent in specialised banks, 7.30 per cent in private banks and 6.02 per cent in foreign banks.
The function was also addressed by Bangladesh Bank deputy governor Abu Hena Mohammad Rezee Hassan and its chief economist Biru Paksha Paul.
Atiur Rahman, however, claimed that the Bangladesh economy has been in a stable position and its banking sector is now passing its best time as there is no liquidity crisis.
He informed that during Ramadan and Eid this year the banking sector had transactions of Tk 112,000 crore. This is 17 per cent higher comparing to last years transactions. There is no complaint about liquidity shortfall, he added.
In such a situation, the BB is going to announce the next monetary policy, he added.
Responding to an allegation on the rise of irregularities in taking foreign loans by some private firms, Rahman said the central bank has strengthened its monetary tools to resist any kind of irregularities.
Out off-site and on-site supervision teams have been consistently keeping their eyes on the transactions and loan procedures. Whenever an allegation is found, our teams take measures, he said.
As part of the central banks green funding policy, Rahman said Bangladesh Bank is going to introduce two new products- one is $300 million World Bank foreign exchange loan for setting up new industries and also for BMRE of old ones.
The governor said that this time Bangladesh Bank is contemplating to announce long and medium term-basis monetary policy thinking about the future economic growth and sustainability.
BSS adds: Bangladesh Bank (BB) will unveil its flagship monetary policy statement (MPS) for the first six months of the current 2015-16 financial year (FY16) on July 30.
Governor Dr Atiur Rahman will announce the MPS at a press conference at the central bank headquarters at 11am, BB general manager at governor secretariat AFM Asaduzzaman told BSS.
Atiur told reporters while addressing a consultation meeting the coming MPS would have a special attention to socially and environmentally responsible financing to protect the environment for the next generation.
Like previous ones, the next MPS would also prioritise financing productive sectors including agriculture, manufacturing and export-oriented enterprises, Rahman said.
He said as a special drive to accelerate export and green financing, the central bank would come up with a $500 million dollar special funds while announcing the next MPS.
Of the total amount, $300 million would go to export sector while the $200 million would be set aside for green financing, the governor said, adding that the two funds would be in foreign currency.
Referring to the existing $2 billion Export Development Fund (EDF), the governor said the two special funds would be additional to the existing EDF.
He said the coming MPS would have a special attention to socially and environmentally responsible financing to protect the environment for the next generation.
Like previous ones, the next MPS would also prioritise financing productive sectors including agriculture, manufacturing and export-oriented enterprises, Dr Rahman said.
