SINGLE DIGIT LENDING RATE

SCBs to give pvt banks fund at 6pc interest

Staff Correspondent | Published: 22:16, Jul 02,2018

 
 

A file photo shows the Bangladesh Bank headquarters at Motijheel in Dhaka.-- New Age

State-owned commercial banks would deposit their fund with private commercial banks at 6 per cent interest rate to help the PCBs implement the banks owners’ decision to cut lending rate to 9 per cent from Sunday.
On the other hand, bankers said that a number of banks have already started lending at 9 per cent from Monday, while the rest would implement the reduced rate within a couple of days.
The announcements came from the bankers meeting held at the Bangladesh Bank headquarters in the capital with BB governor Fazle Kabir in the chair.
After the meeting, BB deputy governor Abu Hena Mohd Razee Hassan, who was present in the meeting, told reporters that the state-owned banks would provide fund to the private commercial banks at the rate of 6 per cent.
Replying a question whether there was any government move with a view to facilitating PCBs with low cost fund from government agencies, he said that there was action from the government end on the issue.
Speaking about the implementation status of reduced lending rate, Hassan said, ‘A couple of banks have already implemented the reduced rate, while the rest are in the process of reducing the rate.’
‘Some [banks] are scheduled to hold board meetings in this regard and I hope that they would implement it within a couple of days,’ he said.
Asked whether the state-owned banks would provide fund to the private banks at the rate of 6 per cent, Obayed Ullah Al Masud, managing director of state-owned Sonali Bank, said that they had agreed to entertain the demand of the private banks for the implementation of 9 per cent lending rate by the private banks.
On the other hand, Association of Bankers, Bangladesh chairman Sayed Mahbubur Rahman said, ‘The central bank did not impose the [rate cut] decision; instead it was the decision of the bank owners. The central bank only suggested us to implement the decision keeping the situation in the banking sector sound and to avoid any chaotic situation.’
‘We have urged the central bank to provide some policy relaxation if any entity fails to follow rules related to advance deposit ratio, liquidity coverage ratio and NFCR of Basel-III,’ he said.
‘In reply, the central bank informed us that they would consider giving policy relaxation if any bank implements the rate cut decision, otherwise central bank would not tolerate any contravention of such rules,’ he said.
Speaking about the implementation status of deposit rate cut to 6 per cent and lending rate to 9 per cent, Mahbubur, also the managing director and chief executive officer of Dhaka Bank, said that several banks including Dhaka Bank had already implemented it and the rest were in process.

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