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BB governor assures DCCI of stock market stabilising moves

Staff Correspondent | Published: 00:00, Jan 15,2020

 
 

Dhaka Chamber of Commerce and Industry president Shams Mahmud presents Bangladesh Bank governor Fazle Kabir a memento during a visit by the DCCI new board of directors at the BB headquarters in the capital on Tuesday. — New Age photo

Bangladesh Bank governor Fazle Kabir on Tuesday assured the Dhaka Chamber of Commerce and Industry representatives that the central bank would take measures for the development of the country’s capital market and stabilising the market.

The central bank will review all of the proposals it received from the capital market stakeholders and take the best possible measures so that all stakeholders are benefited, he said.

The BB governor gave the assurance at a meeting with the DCCI on the day, BB executive director and spokesperson Md Serajul Islam told reporters after the meeting.

The DCCI new board of directors led by its president Shams Mahmud called on the governor at the BB headquarters in Dhaka.

The meeting also discussed the implementation of the single-digit interest rate, liquidity situation in the banks and the country’s overall private sector investment situation.

Meeting sources said that BB governor assured the business leaders that the central bank would take measures what would be effective for the capital market in the long term.

Stakeholders have put forwarded a number of proposals, including Tk 10,000 crore fund for the brokerage houses, to the central bank for the development of the ailing capital market.

Besides, the central bank is also planning to make some recommendations for the long-term sustainability of the capital market to the government, they said.

At the meeting, Mahmud said that though GDP growth crossed the mark of 8 per cent, private sector investment remained stagnant at 22 per cent to 23 per cent of GDP.

A slowdown in the private sector credit growth which was only 9.87 per cent in last November and higher interest rate aggravated the overall private investment, he said.

He requested the central bank to cut down the lending rate to single digit.

The DCCI also suggested the establishment of a mechanism to identify wilful and unintentional defaulters for reducing non-performing loans in the country’s banking sector.

The government should also develop alternative sources like bond market in the capital market for long-term financing for infrastructure and industrial projects to reduce the dependency on public finance and banking system, it said.

Mahmud said that devaluation of the taka against the US dollar might have a negative impact on the economy as the country’s export business relied mainly on the import of raw and intermediary goods.

He sought additional cash incentives to major export sectors instead of devaluation of the taka.

In a press release, the DCCI mentioned that the BB governor said the government was trying to bring down the lending interest rate to single digit, which might be implemented from April.

Kabir said there was a clear definition of wilful and unintentional loan defaulters in the law.

But if an entrepreneur fails to repay loan due to delayed connection of power, energy, gas or delayed loan approval process or some other reasons, he/she might get special consideration, he said.

In the meeting, BB banking reform adviser SK Sur Chowdhury, DCCI senior vice-president NKA Mobin, directors Andaleeb Hasan, Arman Haque, Deen Mohammed, Enamul Haque Patwary, Md Al Amin, Monowar Hossain, Nuher L Khan, Shamsuzzoha Chowdhury, SM Zillur Rahman and Waqar Ahmad Choudhury, among others, were present.

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