NBFIs to get same facilities as banks

Staff Correspondent | Published: 23:00, Oct 26,2016

 
 

Bangladesh Bank on Wednesday decided that like banks, non-Bank financial institutions would be allowed to cut down their capital market exposure by increasing the paid-up capital of their subsidiaries.
The decision came from a meeting between officials of the central bank and managing directors of the non-bank financial institutions at the central bank headquarters in the city.
BB governor Fazle Kabir presided over the meeting.
BB deputy governor SK Sur Chowdhury told reporters after the meeting that NBFIs would enjoy the investment facility at the capital market like the banks.
More than 10 banks adjusted their over-exposure in the capital market by converting the stock-related loans and shareholding in their subsidiaries into paid-up capital.
The central bank will provide approval to the NBFIs if they apply to the BB to enjoy the facility, he said.
The central bank has asked the NBFIs to strengthen good governance to avoid the anomalies and corruption.
The BB asked the NBFIs to disburse long-term credit to promote infrastructural development in the country. The NBFIs should not behave like scheduled banks, the BB official said.
Sur said that the central bank asked the NBFIs to submit reports properly before to the BB to tackle corruption.
Some directors of the NBFIs gave scope to perpetrate corruption as the managements of the financial institutions did not submit reports to the central bank accurately.
The NBFIs will have to place the reports of their short-term transactions in a bid to ensure transparency and good governance.
The central bank will take punitive measures against the NBFIs which will not submit their reports in line with the central bank’s directives, Sur said. 

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