Local-Business
Banks to remain open on June 27, 28 in industrial areas
Bank branches will remain open in industrial areas on Tuesday and Wednesday (June 27 & 28) from 10 am to 2 pm, aiming to facilitate the disbursement of wages, bonus and other allowances to garment workers before Eid-ul-Azha.
The Department of Off-site Supervision of the central bank issued a circular in this regard and sent it to the top executives of all the scheduled banks on Wednesday.
Read: Bank branches to remain closed on Tuesday in election areas
The circular said bank branches in Dhaka metropolitans, Ashulia, Tongi, Gazipur, Savar, Bhaluka and Narayanganj will be kept open for full day on Friday and Saturday to disburse garment workers' wages, bonus and other allowances.
It also instructed to keep open bank branches in Chattogram metropolitan and industrial areas.
The central bank asked banks to arrange adequate security in the bank branches in coordination with local administration.
The holy Eid-ul-Azha will be celebrated across the country on June 29.
Read: Islami bank, Sonali bank branches put under lockdown in Naogaon, Bogura
The government has extended the Eid-ul Azha holidays to four days from June 27 to 30.
The decision came at the Cabinet meeting chaired by Prime Minister Sheikh Hasina at her office on Monday.
Read more: Bank branches at Ctg, Mongla, Benapole land ports to operate 15hrs daily
Nagad dangles ‘Ek Takar’ offer on GP mobile recharge
Nagad, a leading mobile financial service in Bangladesh, has come up with an “Ek Takar” offer on a recharge to any Grameenphone numbers through its app or by dialling USSD *167#, to encourage people to more and more digital transactions.
Customers will get a cashback of BDT 199 on the recharge of BDT 200 to GP prepaid, postpaid, and Skitto numbers through Nagad.
The mobile recharges between 5pm and 8pm will be eligible for the cashback offer. Every hour first 100 rechargers will receive this cashback and the amount will be posted to his or her Nagad number in the next working day.
Read: Nagad became a billion-dollar company in just 3 years, 5 more Bangladeshi unicorns by 2025: Palak
The campaign, which was launched on 19 June, will continue till 25th of this month. A customer can participate in this campaign as many times as they like, says a press release on Wednesday.
Besides, a user making the highest number of BDT 200-mobile recharge a day will get a smartphone or a tab from Nagad. The winners will be notified through SMS if selected for this special prize, and the list of winners will be published on the official Facebook page of Nagad Limited.
Sadat Adnan Ahmed, chief marketing officer of Nagad, said, “Nagad wants as many people as possible in the country to get used to digital transactions and use mobile money for daily needs like mobile recharge. That is why we have launched this campaign in partnership with Grameenphone. We want to make customers’ life easier and more comfortable.”
Read: Establishing Digital Bank paramount to build smart Bangladesh: Nagad MD
No one from Nagad Limited will ask customers for PIN number or OTP for this campaign or for any other reasons. Additionally, Nagad representatives will never call customers to make any transactions or recharge their mobile numbers.
Read: Nagad MD proposes cashless transactions to save billions and build a smart Bangladesh
IBBL gets new chairman
Ahsanul Alam has been elected as the chairman of Board of Directors of Islami Bank Bangladesh Limited (IBBL).
The decision to elect a chairman was taken at the 324th meeting of the Board of Directors of the bank on Monday, said a media release signed by Nazrul Islam, senior vice president of the bank.
Also: Tk 30,000cr loan from Islami Bank: HC asks S Alam Group to explain reports
Ahsanul is the son of Saiful Alam, chairman of S Alam Group, which has controlled IBBL since 2017.
After completing Bachelor's degree from University of Bradford and Master’s in Business Administration (MBA) from Edinburgh Napier University, United Kingdom, he performed duty as chairman of the Board of Directors of Union Bank Limited.
Also read: Scam-hit Islami Bank earns operational profit in 2022, Basic Bank reports loss
Currently he is the chairman of Hasan Abasan (Pvt.) Limited, S Alam Group's flagship real estate company based in Chattogram, and managing director of a number of other companies controlled by the group, including Artsy Holdings Limited, Shining Assets Limited, Affinity Assets Limited, Wesco Limited, Marina Assets Limited and Kraft Holding Company Limited.
Also read: BB disburses Tk 4000 crore as liquidity support to 5 Islami banks
He is also a director of SS Power-I Limited, the country's largest privately-owned thermal power plant located in Banshkhali. Ahsanul is a prominent businessman in the textile, garment and trading sectors.
Also read: Scam-hit Islami Bank earns operational profit in 2022, Basic Bank reports loss
He has already been conferred with the highest taxpayer from Chattogram award twice.
Time-befitting policy needed to utilise potentiality of tannery sector: BTA President
President of Bangladesh Tanners Association (BTA), Md. Shaheen Ahamed, said on Monday that despite immense potentiality of earning foreign exchange from the leather sector the tannery industries have remained backward for lack of time-befitting policy.
The entrepreneurs of the tannery sector faced loss and struggled to survive at Savar Tannery hub where the factories have been shifted without developing necessary infrastructures including an inefficient waste management plant, he said.
Shaheen made the statement in a seminar on "Actions for Sustainable Development of the Leather Industry” jointly organised by the Economic Reporters’ Forum (ERF), BTA, and The Asia Foundation at the ERF Auditorium on Monday.
BTA President Md. Shaheen Ahmed, and Rehena Akter Ruma, head of projects and program of BTA, presented a keynote paper on the overall situation of the tannery sector.
Kazi Faisal Bin Seraj, Country Representative of The Asia Foundation, Ferdaus Ara Begum, CEO of BUILD, Tariqul Islam Khan, Managing Director, Marsons Tannery Ltd, ERF president Refayet Ullah Mirdha and its secretary Abul Kashem, among others, spoke on the occasion.
Read: Treat tannery wastes properly to export leather to EU, US: Speakers
Shaheed said around 40 lakh cows and 45 lakh goats are expected to be sacrificed during the Eid-ul-Azha later this month in the country, and Tk 50,000 to 55,000 crore will be the turnover in the sacrificial animal market.
He said on average the market value of raw hide of a cow of 22 square feet is estimated at Tk 850.
“Other processing will cost Tk 1900. The price of the finished leather is Tk2750. It is possible to make 10 pairs of good quality shoes in the local market or exportable items at an estimated price of Tk50,000,” he said.
Read: Speakers press for compliance in labour rights to develop tannery industry
Shaheen said foreign investors and local entrepreneurs can invest more in the potential leather industries if the government strengthens policy support and ensures global standard waste management plants.
Read more: Speakers press for timely implementation of tannery sector compliance work plan
FBCCI and Faction sign MoU to boost research, innovation
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), the apex trade body of Bangladesh, and Faction, a US-based company, have signed a memorandum of understanding (MoU) to enhance cooperation in establishing the FBCCI Innovation and Research Center.
FBCCI President Md. Jashim Uddin and Faction Co-Founder Max Garza III signed the MoU on behalf of their respective organisations yesterday at the Bengal Commercial Bank head office in the capital.
Read: Rationalize public sector borrowing to encourage private borrowing: DCCI President
Distinguished attendees at the signing ceremony included FBCCI Senior Vice President Mostofa Azad Chowdhury Babu; Vice Presidents M A Momen, Md. Amin Helaly, Md. Habib Ullah Dawn; Acting Secretary General Ambassador Mosud Mannan; and Chief Executive Officer of the FBCCI Innovation and Research Center, Bikarna Kumar Ghosh.
The FBCCI president said, "Bangladesh is moving towards digitization. We must ensure the maximum use of technology to build a developed Bangladesh by 2041, as announced by the Prime Minister. At the same time, country's businessmen must increase capacity to work with the government on the policy level with the problems and possibilities of the private sector.” The collaboration between FBCCI and Faction in the domains of innovation and research will significantly benefit the business landscape of Bangladesh, he added.
Read: Contractionary monetary policy announced to curb inflation
Instead of adopting a "one product, one policy" approach, focus must be on sector-wise policies to encourage product diversification. Innovation and research should be prioritised to foster differentiation among various sectors and clusters, the FBCCI president added.
Md. Jashim Uddin noted that these initiatives with Faction aim to establish linkages between universities, students, and organisations in both countries. By leveraging the expertise and knowledge-sharing between the best universities and institutions in the United States and Bangladesh, both nations will reap substantial benefits.
Read: IDRA appoints observers for Sun-Life, Progressive Life Insurance
Faction Co-founder Max Garza III expressed his enthusiasm for the partnership and acknowledged the immense potential for mutual growth. He stated that the collaboration between Faction and FBCCI would not only benefit Bangladesh but also contribute to the advancement of research and technology worldwide.
Rationalize public sector borrowing to encourage private borrowing: DCCI President
President of Dhaka Chamber of Commerce and Industry (DCCI) Barrister Md. Sameer Sattar said on Sunday that a contractionary Monetary Policy Statements (MPS) will help to revive the financial and private sectors.
The MPS primarily aims to curb inflation by reducing the aggregate demand in the economy, continuing supply-side interventions and a stable and favourable business environment, he said in response to the declared Monetary Policy for the first half of the fiscal year 2023-24 (July-December 2023) by the Bangladesh Bank.
The repo and reverse repo have been adjusted to 6.5% and 4.5% respectively to control inflation by reducing the money supply.
However, the effectiveness of these instruments of controlling inflation is yet to be seen. Because reverse repo was raised earlier but inflation did not decline as expected.
Read: NBR-private sector partnership crucial to achieve high revenue target: DCCI President
MPS showed that the lending rate cap of 9% has been lifted. However, the lending rate will be determined based on a new policy termed as “Short-Term Moving Average Rate (SMART)”.
As a result, the interest rate on bank loans may reach double-digit which may trigger manifold challenges for the survival of businesses in the current volatile geo-economic situation as well as provoking inflation. Lifting the cap of lending rate and introducing the SMART policy may also increase the cost of doing business for CMSMEs.
The public sector credit growth has been set at 43% for July-December of FY24, which was 40% in January-June of FY23. On the other hand, the private sector credit growth has been set at 10.9% for July-December of FY24, which was 11% in January-June of FY23. It is apparent that private sector credit growth has slowed down due to the current geo-economic uncertainty.
Read: DCCI urges industrialists to setup factories in EZs for uninterrupted power supply
DCCI President believes that the target set for public sector credit may limit the scope for private sector borrowing.
“To reduce public sector borrowing, efficiency and good governance must be ensured by adjustment in government spending through austerity measures, rationalization of government expenses and prioritization of development projects,” he said.
He also underscored enhancing tax revenue to reduce the public sector borrowing from the banking sector.
Regarding exchange rate stability, Barrister Sattar agrees that a unified exchange rate will stabilize the market. However, strong monitoring should be in place by the Bangladesh Bank so that it is properly maintained.
Read: Bangladesh economy is growing to offset global challenges: Speakers tell DCCI seminar
Reduction of ERQ encashment limit to 50% and increase of interest of EDF to 4.5% are necessary moves to mitigate the foreign exchange challenges.
To enhance remittance inflow in the country, Bangladesh Bank needs to be very stringent to discourage the informal channel of inward remittance like Hundi.
Barrister Sattar was hoping for solid recommendations from the Bangladesh Bank to deal with Non-Performing Loans (NPLs).
This is because maintaining low NPLs and ensuring good governance in banks and financial institutions are critical for maintaining financial sector stability.
"We hail Bangladesh Bank and the Government of Bangladesh for the formation of a committee to review the existing Bank Company Act 1991 to propose effective resolution to the growing NPLs,” he said.
Since growing NPLs is limiting the private sector credit and in turn, stalling private sector growth, Barrister Sattar feels that stern measures for quick loan recovery should be brought into place.
In connection, he said, Bangladesh Bank can identify and pinpoint the exact reasons, focusing on habitual defaulters, and start engaging with various institutions and stakeholders in order to work towards reducing the current backlog in recovery cases along with quick reforms to introduce ADRs in an effective manner.
Contractionary monetary policy announced to curb inflation
Bangladesh Bank (BB) on Sunday announced a tight monetary policy statement (MPS) for July-December of FY24, lifting the interest rate cap and giving priority to taming inflation and stabilising the exchange rate.
Governor Abdur Rouf Talukder announced the new monetary policy in a press conference at Jahangir Alam Conference Hall, at 3pm. Chief Economist Dr Md Habibur Rahman gave a presentation on the new MPS highlighting the different measures relevant to the macroeconomy.
The governor said, “The BB adopted a contractionary monetary policy to bring down the rate of inflation to a desired level, while remaining supportive to investment and employing generating.”
The central bank has finally removed the lending interest rate cap along with increasing the policy rate (repo rate) by 0.5 percent from July this year from the present 6 percent, in order to control money flow and reduce consumptions, said the BB governor.
Read: Proposed budget for FY 2023-24 fails to address macroeconomic challenges, says CPD
Though it is a contractionary monetary policy, the central bank will ensure money flow for agriculture and rural credit to ensure food production and employment, Rouf said.
These measures are usually adopted to control inflation to bring macroeconomic stability and cut demand.The interest rate cap of 6 percent on deposits and 9 percent on lending(deposit-lending) ended, replacing it with a market-driven smart reference rate, which will be regulated by the average treasury bills rate.
As per the smart rate formula, adopted in the monetary policy, the reference rate will be calculated as the six-month moving average rate of treasury bills with a 3 percent margin for banks and a 5 percent margin for non-bank financial institutions.
Read: RMG exports growth over 10% in first 11 months of FY2022-23
Currently, the rate of the 6-month treasury bills stands at 7.10 percent, so the maximum lending rate for bank loans will be 10 percent plus, and for NBFIs 12 percent plus.
Governor Abdur Rouf said the monetary policy focused on interest rates in order to control the growing inflation, which was created by external effects.
In reply to a query, he said a stable exchange rate and standard foreign exchange reserves are the challenges of this monetary policy.
The MPS has projected private sector credit growth of 11 percent in FY24 from 14 percent in FY23, and public sector credit growth to 30 percent from 37.7 percent.
Read: Bangladesh Bank to announce new monetary policy tomorrow, 9% interest rate cap to be withdrawn
Deputy Governors, executive directors, and different department heads were also present at the press conference.
CIS-BCCI holds its 9th Annual General Meeting
The 9th Annual General Meeting (AGM) of Commonwealth of Independent States-Bangladesh Chamber of Commerce and Industry (CIS-BCCI) was held on Saturday at Gulshan Club, Dhaka.
During the AGM, CIS-BCCI President Md. Habib Ullah Dawn presented the annual report of 2022 and explained the future plan of the Chamber along with past activities.
Mohammad Ali Deen, Senior Vice President of the Chamber presented the financial report of the Chamber for the year 2022.
Read: 11th AGM of AAIBS held; Ibrahim Khalil Al-Zayad elected new Chairperson
The General Members along with the Board of Directors/Honorary Advisers approved the report unanimously.
The meeting ended with a vote of thanks from the Vice President of the Chamber Jadab Debnath.
CIS-BCCI, a registered Trade Body under T.O Rules of Ministry of Commerce, is working to promote bilateral trade relation between Bangladesh and CIS countries including Russia.
Read: 26th AGM of AmCham Bangladesh held
CIS-BCCI regularly interacts with the related agencies of the government and with respective diplomatic missions to explore CIS market including Russia as the 3rd front of export destination after USA and the European Union (EU).
Read more: 22nd AGM of DBCCI held
RMG exports growth over 10% in first 11 months of FY2022-23
The Export Promotion Bureau (EPB) has released the country wise export data for the July-May period of FY2022-23.
The total RMG export during this period has reached USD $42.63 billion with 10.67% year-over-year growth.
Read: Bangladesh Bank to announce new monetary policy tomorrow, 9% interest rate cap to be withdrawn
Out of this total RMG export, $ 21.22 billion went to the EU market with a share of 49.78% of total export, BGMEA Director Md. Mohiuddin Rubel said on Saturday.
The UK held a share of 10.77% and total $ 4.59bn has been exported to the UK; $ 7.73bn has been exported to the USA market, which had a share of 18.14% of total export; Canada held a share of 3.26% and total $ 1.39bn has been exported to Canada, and $ 7.69bn went to the Non-traditional market which had a share of 18.04%, it said.
The European Union has contributed significantly to this growth as it is Bangladesh's largest RMG export destination, with 9.94% growth and $ 21.22 billion of export during July-May 2022-23 compared to $ 19.30 billion, Mohiuddin, additional managing director of Denim Expert Limited, said.
RMG export to Germany has declined by 7.22%, with a total export of US$ 6.03 billion compared to $ 6.50 billion in July-May 2021-22.
Read: Islamic banks can encourage youth-led startups to generate employment: Dr Salehuddin
In France and Italy, exports have increased by 23.4% and 44.81% with $ 2.6 billion and $ 2.06 billion of exports respectively.
During the FY, exports to the USA dropped by 5.07%, from $ 8.14 billion to $ 7.73 billion while exports in the UK and Canada have grown by 12.17% and 17.62%.
Read: Eid-ul-Azha 2023: 5 Bangladeshi Online Cattle Markets to Check Out this Eid
At the same time, the export to non-traditional markets has increased by 32.74%. Among the major non-traditional markets, Japan has shown 45.80% positive growth while Russia and Chile have shown 28.82% and 11.79% negative growth respectively, it added.
Gulf Air rewards top agents
Gulf Air, the national carrier of the Kingdom of Bahrain, has conferred awards on top agents that put up an outstanding performance in sales in the year 2022.
To this end, the airline, which was named the winner of the World’s Most Improved Airline at the Skytrax World Airline Awards 2022, arranged an agent night at Renaissance Dhaka Gulshan Hotel on Thursday, according to a press release.
Read: Bangladesh Bank to announce new monetary policy tomorrow, 9% interest rate cap to be withdrawn
Gulf Air has celebrated such a tremendous success in sales in collaboration with its GSA I-Business Holding Limited based in Bangladesh.
Gulf Air’s country manager to Bangladesh Isa Shah, airport manager of Gulf Air Bangladesh Jassim Ghareeb and Maruful Islam Jhalak, managing director of I-Business Holding Limited – the GSA of Gulf Air, handed over awards to top independent agents.
Maruful Islam Jhalak said, “Agents are playing a significant role in boosting Gulf Air’s business. We shine because of agents who act as our stars.”
Read: Walton sees surge in fridge sales ahead of Eid-ul-Azha
Only because of the agents, Gulf Air has stayed attuned to customer needs and continues to enhance its overall services quality, eventually strengthening the airline’s business and market presence, he added.
Isa Shah said, ‘What we are today is because of our hardworking agents. Their dedication, market insights and commitment to customers have played a vital role in making Gulf Air’s business stronger and enhancing its reputation in the aviation industry.’
They are contributing to ticket sales, providing personalised services, offering expert advice, and thus helping Gulf Air better understand its customers in this region, he noted.
Read: Workers of Forest Department’s SUFAL project to get wages through Nagad
Regarding agents contribution to Gulf Air’s business growth, Tanvir A Mishuk, chairman of I-Business Holding Limited, said, ‘Agents are our partners. Their outstanding efforts in promoting Gulf Air’s services, driving ticket sales, and providing exceptional customer support have been instrumental in the airline’s success. These agents serve as valuable ambassadors, representing Gulf Air in Bangladesh’s market as well as ensuring seamless travel experience for passengers.’