The interest rate on loans from banks in October has been set at 10.20 percent as per Bangladesh Bank’s formula. The method, based on which the interest rate is now being determined, is known as “SMART” or “Six Months Moving Average Rate of Treasury Bills.” Bangladesh Bank informs of this rate at the beginning of every month. The new interest rate determining method was introduced on July 1, 2023. Earlier, from April 2020, the maximum interest rate on bank loans was 9 percent. With D grade Bangladesh Bank governor fares poorly in global ranking Accordingly, in the current month of October, banks can take a maximum of 10.20 percent interest on large-scale industrial loans. On the other hand, non-banking financial institutions (NBFIs) can charge interest against loans by adding a margin at a maximum rate of 5 percent. Their maximum interest rate will be 12.20 percent and 9.20 percent on deposits. However, the loan interest rate set in October cannot be changed within the next six months. This will make the highest interest rate on agricultural loans in September 9.14 percent. An additional 1 percent supervision charge can be levied on CMSME, personal, and car purchase loans. Bangladesh Bank introduces dollar booking policy for max 1 year  Bangladesh Bank publishes the 6-month average interest rate of 182-day treasury bills from January this year. Last January, the smart rate was 6.96 percent. After that, it gradually increased every month and reached 7.13 percent last May. But in June and July, it decreased slightly to 7.10 percent. However, it increased to 7.14 percent in August and reached 7.20 percent in September. On the advice of the International Monetary Fund (IMF), Bangladesh Bank introduced a market-based interest rate system. Despite Bangladesh Bank Governor’s decision to not raise exchange rate before election, dollar rate hiked again The interest rate cap of 9 percent was imposed from April 2020 to facilitate traders. A research report by the central bank also recommends withdrawing or increasing the interest rate limit. But Bangladesh Bank was silent as the government did not give positive consent. One of the conditions of IMF’s USD $4.7 billion loan is to make the interest rate market-based. In light of that condition, the new interest rate system was introduced.

Bangladesh Bank (BB) on Wednesday (December 21, 2022) relaxed term loan repayment policy for non-bank financial institutions (NBFIs) after relaxing such policy for banks’ borrowers. The borrowers would not be declared as defaulters if at least 50 percent of the installments are paid as of September, according to a notice of the central bank. The rest of the installments could be repaid on a monthly or quarterly basis within one year after the current repayment schedule of the loan. Read more: BB relaxes ICRRS to facilitate businesses’ loan The loan repayment relaxing policy would also be applied for the funding in investment of shariah-based financial institutions. If borrowers fail to repay the loans, lease and investments within the new repayment schedule, they would be classified as per rules, the BB notification said. The circular stated that the NBFIs are facing difficulties in realising installments on time as the cash flow to SMEs and large enterprises has been affected by the Russia-Ukraine war and global recession. Read more: BB extends tenure of relaxed ‘risk-weighted’ funding in new investment

The Bangladesh Institute of Bank Management (BIBM) has awarded the Islami Bank Bangladesh, nine other banks, and five non-bank financial institutions (NBFIs) for their performance in sustainable finance. The awards were handed over at the 9th annual banking conference of the BIBM in Dhaka Sunday. Read: IBBL Rangpur holds Shariah compliance webinar Miftah Uddin, senior executive vice-president of the Islami Bank, received the award. The Islami Bank is a joint venture public limited company engaged in commercial banking business based on Islamic shariah. Established in 1983 as the first Islamic bank in southeast Asia, it is listed on the Dhaka Stock Exchange and Chittagong Stock Exchange. Read 10 banks, 5 NBFIs get BIBM awards for sustainable financial performance

The Bangladesh Institute of Bank Management (BIBM) has awarded 10 banks and 5 non-bank financial institutions (NBFIs) for their performance in sustainable finance. The banks are Bank Asia, Brac Bank, Dutch-Bangla Bank, Eastern Bank, Exim Bank, Islami Bank, NRB Bank, Pubali Bank, Southeast Bank, and City Bank. The NBFIs are Agrani SME Finance, Bangladesh Finance and Investment, Bangladesh Infrastructure Finance Fund, IDLC Finance, and IPDC Finance. Read: Certificates awarded for 61st BAF Flying Instructors’ Course The awards were handed over at the 9th annual banking conference of the BIBM in Dhaka Sunday. BIBM Director General Md Akhtaruzzaman, the International Center for Climate Change and Development Director Salimul Haque, GIZ Bangladesh Chief Advisor Firdaus Ara Hussain, and German Development Corporation Deputy Head Florian Hoelen were present at the award-giving ceremony. Bangladesh Bank Sustainable Finance Department Director Khandaker Morshed Millat, Economic Relations Division Deputy Secretary SM Mahbub Alam and BUILD CEO Ferdaus Ara Begum also joined it. Read Islami Bank gets BIBM award for sustainable financial performance

Bangladesh Bank has fixed the interest rate at minimum 7 per cent on deposits and maximum 11 per cent in lending for non-bank financial institutions (NBFIs) like banks. The central bank issued a notification on Monday in this regard and sent to the top executives of all the NBFIs asking them to effect the instruction from July 1, 2022. The BB notification stated that some NBFIs are providing higher interest rates on deposits along with charging higher interest rates on lending, which is not investment friendly at all. Also read: BB to fix interest rates for NBFIs too “To bring an unified system for NBFIS in deposit collection and lending the central bank set a rational interest system to minimize the cost of fund as well investment,’ the BB notification said. The interest rate/profit will be effective on the deposit and lease or lending since the execution date of the instruction while the interest / profit on earlier collected deposit will be as per the condition. The new rate of interest/ profit will be effective after end of its tenure. Also read: Contactless payment service to be available for debit, prepaid card users: BB

Though the employment of women has marked a rise in different sectors in recent years, the average ratio of women employees in banks and non-bank financial institutions (NBFIs) saw a decline by 2.87 per cent in January-June 2021. Bangladesh Bank (BB) gender equality report January-June 2021 shows that the number of women employees stood at 29,513 or 15.8 per cent out of total 186,784 employees in banks and NBFIs. During the same period in 2020, the number of women employees was 28,078 or 18.67 percent of the total 178,510 employees in the banks and NBFIs. The BB statistics show that the average ratio of women’s employees decreased by 2.87 per cent to 15.80 per cent in January-June of 2021, though the total number of women employees grew up to 29513 in the first half of 2021 from 28078 in January-June 2020. The opportunities in the workplace for women have widened in Bangladesh as awareness grows in both public and private sectors to achieve gender equality as part of sustainable development goals (SDGs). Read: Fmr minister Mosharraf’s brother arrested in Tk 2,000cr money laundering case Bangladesh is placed 65th among 156 countries in the latest ‘Global Gender Gap Report, prepared by World Economic Forum. Such progress has been possible for creation of opportunities for women's participation in the workplace and increase in the economic benefits level. Laila Bilkis Ara, secretary Institute of Bankers, Bangladesh (IBB) and former executive director of BB told UNB that the number of women employees in banking is decreasing after withdrawal of 10 per cent quota for women in the recruitment. She said in the perspective of Bangladesh, a girl cannot get enough time for job preparation after graduation as most guardians  prefer to marry their daughter after finishing higher degree.