Syed Mahbubur Rahman, Managing Director and Chief Executive Officer of BRAC Bank distributes relief materials to a woman at a function recently.

BRAC Bank distributed warm clothes to needy people in different parts of the country on the advent of winter season.

BRAC Bank has stood beside the poor people well ahead of cold season to relieve the poor from cold.

The initiatives carry warmth of about 8,000 employees who donated for the humanitarian cause for the less advantaged people of the society.

Three teams of BRAC Bank distributed 3300 blankets and 13,500 warm clothes in two northern and one southern district recently. Employees of the bank donated the warm clothes and raised fund to buy blankets to help people survive imminent winter. Every year in winter, BRAC Bank employees come forward for helping the humanity.

Syed Mahbubur Rahman, Managing Director and Chief Executive Officer, BRAC Bank Limited, said, “BRAC Bank always comes forward for the sake of humanity in line with our 3P (People, Planet, Profit) philosophy.”

News: The Daily Sun/Bangladesh/24-Nov-12

PRETORIA: Despite a bleak economic outlook South Africa’s Reserve Bank opted to leave interest rates on hold on Thursday, fearing any move to stimulate the economy now could fuel inflation.

The bank left its key interest rate at 5.0 per cent, underscoring a growing quandary facing policymakers in Africa’s largest economy who expect inflation to continue to rise and growth to continue to slow.

Unpacking a litany of problems facing the economy, bank governor Gill Marcus acknowledged the economic outlook had “deteriorated” but said current level of stimulus was “appropriate.” “The domestic growth outlook has deteriorated, while the upside risks to inflation have increased,” Marcus said.

The bank cut its growth outlook for 2013 dramatically from 3.4 per cent to 2.9 per cent, while predicting that inflation would peak at 5.7 per cent in early 2013.

That is lodged at the very upper end of the bank’s three to six-per cent target for consumer price increases. Despite the bleak outlook, the central bank as expected kept interest rates unchanged.

“The bank finds itself stuck in a deepening stagflation bind,” said Bruce Donald, an economist with Standard Bank.

“We expect that, when the bank believes that it has the room to ease, it will cut” its benchmark lending rate, said Donald.

Many predict that the reserve bank could make a move to cut rates early in 2013, but it is far from clear when the economic situation will offer room to do so.

Consumer prices have been pushed higher by a weaker rand and higher food prices, which in October increased at a faster rate than at any time since 1994.

News: The Daily Sun/Bangladesh/24-Nov-12

Md Anisul Haque, Chairman of SIBL inaugurates the bank’s 17th anniversary at the bank’s corporate office Thursday.

Social Islami Bank Limited (SIBL) celebrated its 17th anniversary Thursday at its corporate office.

Chairman of the Board of Directors of the bank Md Anisul Haque inaugurated the function, said a press release.

Vice Chairman of the bank Al-haj Sheikh Md Rabban Ali and Director Md Abdul Awal Patwary were present in the function.

Managing Director Md. Shafiqur Rahman, Deputy Managing Directors AMM Farhad and Md. Mohashin Miah and executives and officers of SIBL corporate office were present.

News: The Daily Sun/Bangladesh/24-Nov-12

An extensive expansion has been occurred in capital base of the country’s banking sector during last four years. It has been happened due to transfer of a large proportion of profit of banks into capital. As a result, base of banking system becomes stronger.

Capital adequacy is one of the key parameter of economic fitness and stability of banks. That’s why for strengthening of the capital base of banks, Basel-II accord relating to capital adequacy has been fully implemented by the central bank following the international best practices rules & regulation. Necessary steps have also been taken for implementing Basel–III accord in near future. According to Basel-II, banks are required to maintain capital at 10% of risk weighted assets, but in reality the banks have been able to maintain more than the required level which is now 11.31%.

Mentionable that, according to Basel-II accord banks had to maintain risk based capital adequacy up to 2008. As per this accord, the total amount of actual capital maintained by banks was taka 20,578 crore at end of 2008. The figure has gone up to taka 56,201 crore over the last four years (up to June 2012). This capital base increased due mainly to respond to risk sensitive Basel-II accord.

News: The Daily Sun/Bangladesh/24-Nov-12

Bad loans increased by Tk 7,282 crore or 1.58 percentage points in the third quarter this year as a significant amount of loans related to the recent incidents of scams was classified.

The central bank is putting pressure on the banks to get the real picture of their loan defaults.

On September 30, the total amount of bad loans in the banking sector was Tk 36,282 crore or 8.75 percent of the total outstanding loans.

The amount was Tk 29,000 crore or 7.17 percent of total loans on June 30.

According to Bangladesh Bank statistics, the highest increase in such loans was in the state-owned commercial banks that saw a rise by Tk 3,746 crore in the third quarter.

The amount of total classified loans at these banks stood at Tk 15,518 crore on September 30.

The classified loans at the private banks also marked a rise, by Tk 3,280 crore during the same period, and reached Tk 13,585 crore.

Bankers said the central bank recently detected loan-related irregularities in some public banks, and put pressure on the banks to classify the loans.

Hall-Mark Group and some other businesses embezzled Tk 3,547 crore from Sonali Bank's Ruposhi Bangla branch on forged documents.

On November 18, Finance Minister AMA Muhith also said in parliament that a significant amount of funds was also embezzled through Sonali Bank's Gulshan and Agargaon branches.

The finance minister said incidents of forgery were also detected in the accounts of some customers of Rupali, Janata, Agrani and BASIC Bank.

According to BB statistics, the amount of bad loans increased by Tk 1,733 crore in Sonali Bank, by Tk 758 crore in Janata, by Tk 1,092 crore in Agrani, and by Tk 163 crore in Rupali Bank during the July-September period.

Though BASIC is not a state-owned commercial bank, it is run under the government's control. During the period, bad loans increased by about Tk 200 crore at BASIC Bank.

The entire amount of the money involved with the irregularities unearthed recently has not yet been classified and the loan defaults may increase further in December when these loans will be classified.

Pradip Kumar Dutta, managing director of Sonali Bank, told The Daily Star that Tk 400 crore, a portion of the loans taken by the Hall-Mark Group, was classified in September.

The rest of the amount is likely to

be classified in December this year,

he added.

On the increase in loan defaults, the Sonali Bank's chief executive said the amount of bad loans marked a rise as their recovery, write-off and rescheduling was less this year compared to the previous year.

He also said they wrote off around Tk 800 crore last year, but the amount was only Tk 2 crore so far this year.

Dutta also said, to realise the loans from the Hall-Mark Group, the bank has taken the Group's 88 acres of land as mortgage. The lands are worth about Tk 560 crore on conservative estimates made by the bank.

Another 45 acres of land are being taken as mortgage, said the official of the bank.

He said, as a result they hope to securitise about Tk 1,000 crore against the loans given to Hall-Mark.

A central bank official said the BB has tightened its supervision after the incidents of loan scams were detected in some state banks.

The central bank also identified irregularities in some private banks that have already classified the loans, leading to a rise in default loans in those banks, he said.

News: The Daily Star/Bangladesh/24-Nov-12