Business
Interest rate for April set at 13.55%, for consumer loans add 1%
The interest rate on bank loans for April based on the ‘Six-Months Moving Average Rate of Treasury Bills’, SMART system has been announced by Bangladesh Bank.
The Banking Regulation and Policy Department of Bangladesh Bank (BB) issued a circular in this regard on Sunday.
The SMART increased by almost 1 percent to 10.55 percent in March, from 9.61 percent in February and 8.68 percent in January.
Stock markets end on high note Sunday amid price increase
Banks will be allowed to add a maximum 3.0 percent to the SMART number when signing loan agreements in April, down from 3.5 percent in March.
As a result, the interest rate on bank loans will be charged a maximum of 13.55 percent in April, while the interest rate on consumer loans will be a maximum of 14.55 percent as a bank can charge a 1.0 percent supervision fee for consumer loans.
The interest rate on bank loans in March was 13.11 percent, while it was 14.11 percent on consumer loans. Before that in February, it was 12.43 percent and 13.43 percent. In January this interest rate was 11.89 percent and 12.89 percent.
As the SMART rate increased more than expected in March, the BB reduced the 'SMART' margin rate that banks are allowed to add by 0.50 percent in the interest of consistency with the monetary policy. The BB cut the margin by 0.25 percent in February.
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As per the new guidelines, the margin added for pre-shipment export loans and agricultural and rural loans will be a maximum of 2.0 percent in April, which was 2.50 percent in March.
Generally, the loans taken from banks for purchasing personal and consumer goods such as car loans, housing loans, and education loans, including refrigerators, TVs, computers, etc., are consumer loans.
Talking to UNB, executive director of the Policy Research Institute Dr Ahsan H. Mansur said that the central bank has no choice other than increasing interest rates to control inflation.
"The interest rate hikes would continue till the inflation rate comes down to 5-6 percent, only then will the interest rate stabilise," he explained.
During this period, industries and personal borrowers will suffer, but they must face the reality. Through this hardship, the economy will gain strength and stability.
Stock markets end on high note Sunday amid price increase
The prices of stocks of almost all companies listed at the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) showed an upward trend on Sunday.
The stock showed this upward trend on the first working day of the current while the prices of stocks and the index of both the markets fell last week, according to market data.
Last week, out of the four trading days, the prices of stocks fell in the first three working days. However, the price increases slightly on the last working day of the week. As a result, the stock market was bullish for two consecutive working days.
No reason for deteriorating stock market situation, said Brokers’ Association
Since trading started in the stock market on Sunday, the share and unit prices of most of the companies increased. The share prices of most companies continue to rise throughout the trading period. As a result, the day's trading ended with a big rise in the index.
The end of the day's trading shows that the prices of 273 companies have increased on the DSE. On the contrary, the price of 74 companies has decreased. The price of 49 companies remains unchanged. In this, the main price index of DSE DSEX increased by 51 points to 5829 points.
The DSE-30 index, which consists of 30 companies, has increased by 10 points compared to the previous day and stands at 2021 points. And the DSE Shariah index rose by 11 points to 1,266 points compared to the previous day.
Along with the increase in all indexes, the volume of transactions on DSE also increased. Tk467 crore was traded in DSE, while Tk411.08 crores were traded on the previous working day. Accordingly, the transaction has increased by Tk55.92 crore.
Shares of Central Pharmaceuticals contributed the most to this transaction. The shares of the company were traded worth Tk 24.73 crore. Shares of Shahinpukur Ceramics in the second place were traded worth Tk 23.43 crore. Asiatic Laboratories is in third place with a share transaction of Tk 20.55 crore.
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The country’s other stock market Chittagong Stock Exchange (CSE) overall price index CASPI increased by 75 points. The prices of 123 companies out of 211 have increased. In contrast, the prices of 66 decreased and 22 remained unchanged. At the end of the day, the volume of transactions at the CSE stood at Tk11.92 Crore.
Banks to remain open on April 5, 6, and 7 for payment of garment workers’ salary, bonus
Bangladesh Bank has asked the scheduled banks to keep branches open on April 5, 6, and 7 under special arrangement for payment of garment workers' salaries, Eid bonuses, allowances, and export bills.
The Department of Off-site Supervision of the central bank on Sunday issued a circular in this regard and sent it to the top executives of the banks for necessary actions.
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As per the central bank’s instruction, the banks will remain open for transactions from 9:30 am to 12:30 pm on a limited scale.
It instructed banks to keep open the branches in Dhaka metropolitan area, Ashulia, Tongi, Gazipur, Savar, Bhaluka, and the industry-related branches of banks located in Narayanganj and Chittagong ensuring adequate security.
Sonali Life Insurance's CEO removed
Mir Rashed Bin Anam has been suspended and removed from the post of chief executive officer (CEO) from Sonali Life Insurance Company Ltd, known as Sonali Life.
According to official sources, the Insurance Development and Regulatory Authority (IDRA) in a letter in this regard on March 28 approved a decision of the board of directors of the Sonali Life Insurance, which was taken on March 14 this year.
Earlier, the Rashed was appointed as CEO of the Sinali Life on April 24 in 2022. But a move was initiated by the Sonali Life authority to remove him from the CEO post after his “Master of Business” degree certificate was proven to be fake.
Rashed could not be contacted as he has been in jail since March 14 in a money embezzlement case.
Sources said a three-member investigation committee, formed by the Sonali Life authority, found the Master of Business certificate, received from University of Technology Sydney, fake.
In addition, a huge misappropriation of funds by the CEO was also found by the investigation committee, said a source at the Sonali Life Insurance Company.
Envoy Textiles’ 28th AGM held, Shehrin Salam dismissed from board, Tanvir re-elect MD
Envoy Textiles Limited has conducted its 28th Annual General Meeting (AGM) amid critical outcomes for its leadership and board structure.
Tanvir Ahmed was emphatically re-elected as Managing Director (MD) for another term of five years, receiving a unanimous vote of confidence from the shareholders. He got a total of 10 crore 63 lakh 83 thousand 178 votes in his favour.
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The AGM, held in a hybrid format at Gulshan Shooting Club, Dhaka, on Thursday, was chaired by Kutubuddin Ahmed, the founder and chairman of Envoy Textiles Limited.
A major reshuffling of the board occurred during the meeting. An overwhelming 99.97 percent of shareholders opposed the re-election of Shehrin Salam Oishee as a director, leading to her removal from the board.
Sunil Daulatram Daryanani, nominated by Epic Garments, was elected as a new director. Furthermore, the AGM reinforced the company’s strategic direction by unanimously re-electing Kutubuddin Ahmed and Sumayyah Ahmed as directors, ensuring a continuity of strong leadership.
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Adding to the backdrop of these decisions, in a previous Extra-ordinary General Meeting (EGM) held on March 2, 2024, Shehrin Salam Oishee was also not elected as Deputy Managing Director (DMD), indicating a significant shift in the company's executive leadership dynamics. These developments underscore a period of transition and strategic realignment for Envoy Textiles Limited.
Cold storage owners want integrated policy to enhance cold chain efficiency for sustainable goods supply
Bangladesh Cold Storage Association (BCSA) on Thursday urged for an integrated policy for the development of cold chain infrastructure in the country to ensure a strategic supply of perishable goods such as potatoes, onions, and tomatoes in off-seasons.
The leaders of BCSA said this at a meet the press, held at BSCA Office in Paltan in the capital ahead of the Cold Chain Bangladesh-2024 exhibition, scheduled to be held at the International Convention City Bashundhara (ICCB) in May this year.
Savor International Ltd, in collaboration with the BCSA, will organise the exhibition, with participation of 14 countries.
Mostofa Azad Chowdhury Babu, President of BCSA, said there is an urgent need to reform the current financial structure including introducing lower interest rates for investments in cold chain management.
He highlighted the necessity of accessing loans from foreign sources at lower interest rates to facilitate the development of state-of-the-art cold chains.
BCSA President said in the exhibition, stakeholders will advocate for implementing public-private partnerships (PPPs) in cold chain management, emphasising the importance of specialised cold storage facilities and post-harvest management education for farmers and industry professionals.
In response to a question, he expressed concerns over potential potato shortages and urged authorities to provide accurate data on potato production to mitigate market disruptions.
He expressed his concern that consumers might have to buy potatoes at over Tk 50 a kg as farmers' level price is Tk 27-32 a kg this year, which was a maximum Tk 18 a kg last year.
Mohammad Asaduzzaman, President of Bangladesh Refrigeration and Air-conditioning Merchant Association (BRAMA) and Chairman of the Standing Committee on Refrigeration, Air Conditioning, and Cold Chain Policy Implementation of FBCCI, mentioned the challenges faced in importing cold storage equipment and spare parts, which is needed to cut higher import to stimulate investment in the country's cold chain infrastructure.
Istiaque Ahmed, Senior Vice President of the Cold Storage Association, emphasised that cold storage is essential not only for food security but also for ensuring food safety by reducing the need for harmful preservatives.
Md Faizul Alam, Managing Director of Savor International Ltd, Md Hasmotuzzaman, Chairman RP, ASHRAE Bangladesh Chapter also spoke among others at the event.
Govt has no complete list of public services against which it levies fees or charges: Finance Ministry document
The government of Bangladesh has no complete list of public services against which it levies fees or charges.
“There are thousands of public services against which the government levies fees or charges, but there is no complete list of such fees and charges and when those were imposed,” according to an official document of the Finance Ministry.
According the official document titled ‘Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26)’ of the Finance Division of the Finance Ministry, the government has partially set up an online database of all non tax revenue (NTR) items with the fees, charges or prices and their dates of imposition.
“This partial database has opened scope with the hope of increasing NTR income manifolds from administrative fees,” it said.
On the other hand, the government is not only focusing on enhanced revenue mobilisation from NTR by raising fees or charges, but also putting its best effort to ensure efficient and satisfactory service delivery.
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The government has taken numerous initiatives to make service delivery systems paperless and to minimise human deployment in this system. This is one of the key features to building Smart Bangladesh by 2041, the document said.
The government has multiplied public investment during the last one and a half decade, of which the SOEs/Autonomous Bodies (ABs) have enjoyed capital support either in the form of loans or equities.
Loans are registered under government accounts through Subsidiary Loan Agreements (SLAs) and thereby interest is charged.
“However, there is no consolidated database for equity investments of the government and therefore there is no precise estimate for dividend income,” the official document said.
The government has taken the initiative to create an exhaustive database for equity investments in the SOEs/ABs as well as establish a Financial Reporting Council for setting standard financial statements to ensure proper assessment of these organisations.
According to the ‘Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26)’, With the economic advancement of the country the scope and volumes of public services have evolved and expanded.
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Government organisations are engaged in delivering various new services in new forms to the public.
The government has taken initiatives to explore such novel and voluminous services against which fees/charges may be collected through organising stakeholders’ consultation workshops, seminars, etc.
As per the Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26) of the Finance Division, some Tk 5343 billion will come from tax revenue sector in the 2024-25 fiscal year and Tk 6463 billion in 2025-26 fiscal year.
In the next two fiscal years, the National Board of Revenue (NBR) will provide Tk 5095 billion and Tk 6171 billion.
From the Income Tax wing, the collection will be Tk 1753 billion for the next fiscal while Tk 2123 billion for 2025-26 fiscal, and the collection from import duties will be Tk 1511 billion and Tk 1830 billion respectively.
From the VAT and supplementary Duties, the revenue collection will be Tk 1831 billion and Tk 2218 billion respectively.
The non-NBR tax for the 2024-25 fiscal and 2025-26 fiscal will be Tk 248 billion and Tk 292 billion respectively with non-tax revenue collection will be Tk 529 billion and Tk 634 billion respectively.
The target for running 2023-24 fiscal is Tk 5000 billion with Tk 4500 billion from tax revenue. Of the total amount, Tk 4300 billion will come from NBR through Tk 1480 billion from income tax, Tk 1275 billion from import duties, Tk 1545 billion from VAT and supplementary duties. Some Tk 200 billion will be collected from the non-NBR sector while Tk 500 billion from the non-tax revenue sector.
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FBCCI urges market committee to be proactive to prevent dishonest traders
The market monitoring committee of FBCCI has called upon the concerned market committee to be proactive to counter any traders who try to make extra profit through dishonest means.
Md Amin Helaly, senior vice-president of FBCCI and convener of the market monitoring committee, made the call at the FBCCI's market monitoring committee meeting with the leaders of the local market committee at Mohammadpur town hall Katcha Market in the capital on Wednesday.
Speaking as the chief guest at the meeting, Helaly said dishonest businessmen and all parties involved with them should be identified and punished.
He asked to collect reports of dishonest traders and submit it to the FBCCI. "We will take strict action against them with the cooperation of the government."
The FBCCI leader said the federation is monitoring the market from the place of responsibility of the private sector to keep the market stable during Ramadan.
He said, “Our activities will continue along with various government agencies. But consumers also need to change their buying habits. A month's market should be more moderate than in one day.”
FBCCI directors and members of the Bazar Monitoring Committee were present at the meeting.
Women entrepreneurs' fair promotes 'Made in Bangladesh' products
Women entrepreneurs’ products fair titled "She Entrepreneurship Fair 2024" is going on at Aloki Convention Centre in Dhaka's Gulshan.
Brac Bank organised the fair to promote the campaign "Made in Bangladesh" products.
A total of 85 women entrepreneurs from all over the country have participated in the fair.
Brac Bank is organising this product exhibition for women entrepreneurs for the second time, where entrepreneurs get their stalls without any cost. Most of the women entrepreneurs participating in the fair are involved in the manufacturing sector.
Deputy Governor of Bangladesh Bank (BB) Nurun Nahar inaugurated the fair as the chief guest on Tuesday.
Chairman of SME Foundation Dr Masudur Rahman and Managing Director of Green Delta Insurance Company Farzanah Chowdhury, Brac Bank Managing Director and CEO Selim RF Hussain, and head of SME Banking of Brac Bank Syed Abdul Momen, among others, were present at the inaugural event.
Banks’ CSR spending down by 18 percent in 2023: Bangladesh Bank
Banks’ spending in Corporate Social Responsibility (CSR) has decreased by 18 percent to Tk 924.32 crore in 2023, compared to the previous year.
Bangladesh Bank (BB) report on CSR of 2023 released on Wednesday saw that banks spent Tk 924.32 crore in 2023, which was Tk 1129 crore in 2022. It shows that banks’ spending in the CSR sector decreased by 18 percent or Tk 204.67 compared with the previous year.
According to the report, the highest expenditure in 2023 was in the health sector followed by education and environment and climate change issues.
According to the BB guidelines, 30 percent of the total CSR expenditure of banks and financial institutions should be spent on education, 30 percent on health, and 20 percent on environment and climate change mitigation and adaptation. The remaining 20 percent is directed to be spent on income-generating activities, disaster management, infrastructure development, sports and culture, and other sectors.
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According to the report, 61 scheduled banks have spent Tk 924.32 crore in 2023. Out of this, the health sector spent the most 31.26 percent or Tk 289 crore of the total expenditure.
The spending on the education sector is 17.65 percent or Tk163.10 crore, and the expenditure on the environment and climate sector is 7.38 percent or Tk68.17 crore of the total expenditure. Apart from this, the expenditure on other sectors is 43.72 percent or Tk404 crore of the total expenditure.
According to the CSR report, among the 61 scheduled banks operating in the country, 5 banks did not spend a single taka on CSR in 2023. These are Basic Bank, Bengal Commercial Bank, Citizens Bank, ICB Islamic Bank, and National Bank.
On the other hand, 9 banks did not earn net profit in 2022. They are Basic Bank, Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank, Bangladesh Commerce Bank, Bengal Commercial Bank, Citizens Bank, ICB Islamic Bank, Padma Bank and National Bank of Pakistan.
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However, 5 of these 9 banks spent on CSR in 2023 despite not earning net profit. The banks are Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank, Bangladesh Commerce Bank, Padma Bank, and National Bank.
The 13 banks licensed after 2013 have a requirement to spend at least 10 percent of the previous year's net profit on CSR in the following year. If a bank cannot make a net profit, it cannot spend on CSR.
In analysing the report found that 6 banks of the fourth generation --South-Bangla Agriculture and Commerce Bank Limited, Midland Bank Limited, Madhumati Bank Limited, Shimanto Bank Plc, NRB Commercial Bank Plc, and Global Islami Bank Plc-- have failed to comply with the conditions of the central bank during the discussed period.
Islami Bank Bangladesh Plc has spent the highest CSR among the banks. In 2023, the bank has spent about Tk 100 crore in this sector. Dutch-Bangla Bank spent the second highest amount of Tk 94 crore and Jamuna Bank is in the third position by spending Tk 56.73 crore in the CSR sector.