UNSETTLED INLAND BILLS
5 banks’ warned of losing top AD branch licencesAKM Zamir Uddin
Bangladesh Bank has warned five scheduled banks of cancellation of authorised dealer licences of top branch of each bank over their failure to settle back-to-back inland bills against local letters of credit in line with the central bank directive.
The BB on February 5 issued separate show-cause notices to the five banks asking them to reply within 15 working days why the central bank would not cancel licences of their five AD branches, a BB official told New Age on Monday.
The errant five banks are Janata Bank, Islami Bank Bangladesh, Pubali Bank, Southeast Bank and Mercantile Bank.
The central bank identified that overdue position of the five banks in settling the inland bills remained at the top for a long time among all scheduled banks.
‘The central bank has issued the show-cause letters to the five banks as part of its online monitoring system on foreign exchange-related business of the banks,’ BB deputy governor Nazneen Sultana told New Age.
The BB will take punitive measures against the banks if they fail to give satisfactory reply to the notices, she said.
The official said that the central bank on December 23, 2013 had served another show-cause notice in connection with the overdue inland bills on 30 banks, asking them to reply to the notices by January 19, 2014.
After the issuance of the notice, a number of banks settled their inland bills in the quickest possible time, but the five banks did not take adequate measures in this connection.
The BB official said the central bank had organised a series of meeting with the banks in mid-November in which the banks had promised that they would settle the overdue inland bills within that month.
But, the banks did not keep their commitments, he said.
According to the latest BB data, Janata Bank’s overdue inland bills stood at $8.70 million as of February 9, 2014, that of Islami Bank $4.90 million, that of Pubali Bank $6.12 million, that of Southeast Bank $4.80 million and that of Mercantile Bank $13 million.
The country’s banking sector has been facing indiscipline for long due to the overdue inland bills as significant amount of funds of some banks remain stuck in the process, another BB official said.
He said the BB had already introduced an electronic monitoring system named ‘Dashboard’ to bring discipline in the foreign exchange-related business in the banking sector.
The BB issued the show-cause letters to the five banks by collecting information from the ‘Dashboard’, he said.
IBBL managing director Mohammad Abdul Mannan told New Age on Monday that his bank had already taken initiative to settle the overdue inland bills.
The BB in its February 5 letter referred to the Nawabpur AD branch of IBBL.
‘We have settled a large number of overdue bills after receiving the BB notice,’ Mannan said.
He, however, said that IBBL was one of the largest banks in terms of export and import LCs in the country.
‘So its inland bills overdue position is higher than other banks.’
Pubali Bank managing director Helal Ahmed Chowdhury told New Age that he made a commitment to the central bank on Monday that his bank would settle all inland bills by this month.
Pubali Bank has already settled a number of overdue bills in the last few days, he said.
The central bank’s show-cause letter referred to the principal branch of Pubali Bank.
comments powered by Disqus
Spot export orders at the Dhaka International Trade Fair 2014 have dropped by nearly 50 per cent to Tk 80.44 crore this year from Tk 157 crore in last year as many buyers skipped the fair due to political uncertainty. Participants at the month-long... Full story
The power, energy and mineral resources ministry has issued a guideline for setting up fuel oil refuelling stations relaxing restriction on maintaining minimum distance for new filling stations to be established outside city corporations and district towns. Full story
The Bangladesh Securities and Exchange Commission is likely to request the finance ministry to refrain Bangladesh Bank from monitoring on daily basis banks’ capital market investment through their merchant banks, BSEC sources said. Full story
Attracting foreign direct investment is the first priority of the government to spur economic growth and boost investment in the country, commerce minister Tofail Ahmed said on Monday. ‘We are taking different steps... Full story
Dhaka stocks declined for the second trading session on Monday with a drop in turnover due to late trading session’s sell-offs made by investors to book some profit. The benchmark general index of Dhaka Stock Exchange, DSEX, decreased... Full story
Mobile phone operator Grameenphone will provide schoolchildren of 250 institutions across the country with 21 lakh free internet hours on the occasion of Language Movement Day that falls on February 21. The students will be able to use... Full story
Toyota on Monday said it will stop making cars in Australia in less than four years, bringing the country’s auto industry shuddering to a halt, despite appeals by the prime minister Tony Abbott. The Japanese auto giant said production of vehicles and engines... Full story
Bangladesh will be connected with the second submarine cable having a total capacity of 1,400 Gbps, by early 2016, said officials. They said Bangladesh Submarine Cable Company Limited who is responsible for maintenance of the submarine... Full story
The Indus Entrepreneurs, a Silicon Valley-based non-profit organisation, on Monday launched its Dhaka chapter to facilitate young entrepreneurs in the global platform. ‘The organisation will facilitate young entrepreneurs by guiding them from idea generation to finding... Full story
The dollar inched up in Asia Monday after a disappointing US jobs report fuelled questions about the pace of the Federal Reserve’s stimulus taper. The greenback rose slightly to 102.34 yen in afternoon Tokyo trade, from 102.30 yen in New York Friday. Full story
Oil prices eased in Asia Monday following weak US jobs data but losses were curbed as fears of another severe North American winter storm boosted the demand outlook for heating fuel, analysts said. New York’s main contract, West Texas... Full story
Keya Cosmetics Keya Knit Composite, one of the corporate sponsors/directors of the company, has expressed its intention to sell 22,75,000 shares out of its total holding of 1,84,45,378 shares of the company... Full story