The ensuing commercial banks have begun seeking final green signal of the central bank to start their operations as they fulfil requirements in line with the letter of intent (LoI).

On April 17, Bangladesh Bank (BB) issued the LoI with putting 29 conditions that the banks should comply with to get the licenses. One of the major conditions suggests that the entrepreneurs should start their banking operation in six months after getting approval of the central bank.

After complying LoI, so far two proposed commercial banks - South Bangla Agriculture and Commerce Bank Limited and NRB Commercial Bank Limited - have submitted their paper works and documents required to obtain licences from the BB.

“We're preparing to begin operations in November,” an official close to the new NRB Bank, said.

October 16 has been set for the newly approved nine commercial banks for submitting necessary documents of LoI compliance to the BB.

The BB will issue licences to the banks after scrutinising their documents, sources said.

“All proposed banks will have to apply to the central bank within the deadline seeking licences for beginning their businesses,” said a BB official.

The banks, however, would be allowed to seek time extension if they cannot meet the deadline, he said.
Only one bank has so far applied for extending the deadline for submission of documents.

The central bank has been scrutinising the documents before issuing licences to the new banks.  As part of the scrutiny, the BB officials will check tax-related issues with the National Board of Revenue (NBR) in case of local sponsors.

Sponsors of the proposed non-resident Bangladeshi (NRB) banks will deposit their paid-up capital in foreign currency, the central banker said.

The paid-up capital of a new bank will be no less than Tk 4.0 billion, the central bank said in its guidelines for setting up new commercial banks.

If an individual or any member of his or her family is or was a loan defaulter with a bank or financial institution anytime during the past five years, he or she will not be eligible to apply as a sponsor of any proposed bank.

An individual awaiting verdict of any indisposed lawsuit in any court or tribunal against his/her loan default status will not be eligible to apply as a sponsor, the guidelines added.

The central bank on April 4 approved three NRB (Non-resident Bangladeshi) banks.

The banks are sponsored by expatriate Bangladeshi in the United States, Iqbal Ahmed Chowdhury and Farasath Ali and Nizam Chowdhury who is residing in the United Kingdom.

The central bank on April 8 also approved six new banks, sponsored by local entrepreneurs.

The banks are Union Bank, Madhumati Bank, Farmers Bank, Meghna Bank, Midland Bank and South Bangla Agriculture and Commerce Bank.  The prime sponsors of the six banks are former president HM Ershad (Union Bank), Fazle Noor Taposh (Modhumati Bank), Dr Mohiuddin Khan Alamgir (Farmers' Bank), SM Amjad Hossain (South Bangla Agriculture and Commerce Bank), Ashequr Rahman (Meghna Bank) and Moniruzzaman Khan Khandker (Midland Bank).

News: The Daily Independent/Bangladesh/8th-Oct-12