The central bank of Bangladesh asked the state-owned Sonali Bank Limited (SBL) to take necessary action in the event of any forgery of inland bills in consultation with legal experts, official sources said.

In a letter issued Monday, the Bangladesh Bank (BB) also reminded the SBL of making payment to the country's 32 local and foreign commercial banks against only genuine overdue inland bills.

The BB in the letter sent to the SBL managing director said, "In the event of payment against an inland bill if you think it is genuine, make payment on your own responsibility and take steps to collect the money from your clients," the BB letter said.

"You also may take recourse to legal action in case of any forgery of inland bills in consultation with legal experts," the letter added.

The BB collected information on inland bill purchase (IBP) in a bid to find out any such bills' link with the Hallmark loan scam that involved the Ruposhi Bangla Hotel branch of the SBL and other bank branches in Dhaka and Narayanganj, official sources said.

A total of 19 inspection teams of the BB collected the information from 50 branches of 27 commercial banks located in the capital and in Narayanganj.

Last month the Sonali Bank submitted to the BB a list of the overdue 'inland bills' seeking the central bank's clearance about making payment against the bills.

Thirty-two banks claimed about Tk 15 billion with extra charges against the bills.

The SBL also pointed out that a large number of the claims made by the banks were not genuine.

Either the SBL branch in question had no record against such claims or the branch officials had assisted the traders concerned in supplying fake documents against the bills.

However, it was not known immediately how many 'inland bills' were fake.

"We are now working on recourse to legal action in the fraudulence and the inland bill forgeries," an SBL high official said.

"We are now looking into genuineness of the bills. We'll settle payment against the genuine inland bills," he also said.

The Bangladesh Bank authorities after a formal meeting with the apparel sector leaders last month verbally instructed the banks to settle all 'overdue payments' and buy fresh 'inland bills' to restore confidence of both bankers and traders.

In September the Anti-Corruption Commission (ACC) took a legal move against the officials suspected to be involved in the Hall-Mark loan scam.

News: The Daily Financial Express/Bangladesh/07-Nov-12

The central bank has increased the allocation of the export development fund (EDF) to US$ 600 million from $500 million earlier to meet the growing demand of the country's exporters, officials said Tuesday.

"We've enhanced the amount of EDF aiming to facilitate export of the country," a senior official at Bangladesh Bank (BB) told the FE, adding that other provisions related to EDF will remain unchanged.

The BB official also said the central bank was providing the re-financing facilities to the exporters through commercial banks as short-term liquidity support.

"The EDF financing is allowed for input procurements against back-to-back import letters of credit (LCs) or inland back-to-back LCs in foreign exchange, by manufactures producing final output for direct export and also by producers of local deliveries to manufacturers of the final export," the central banker noted. The country's exporters welcomed BB's latest move, saying that the increased amount of EDF would help the export businesses retain its position in the global market.

"It will help the country's exporters to meet their short-term liquidity crunch," president of Exporters Association of Bangladesh Abdus Salam Murshedy told the FE.

Mr. Murshedy, also former president of Bangladesh Garment Manufactures and Exporters Association (BGMEA), said the central bank should increase the allocation of EDF considering the country's overall export growth.

News: The Daily Financial Express/Bangladesh/07-Nov-12

The government will reconstitute the boards of state-owned banks next week, Finance Minister AMA Muhith said on Tuesday.

Currently, about 50 posts of directors in 10 state-owned commercial banks (SCBs) and specialised banks are lying vacant.

"The boards of state-owned banks will be reconstituted next week," Mr Muhith told reporters at his Secretariat office.

The selection of bank directors will be made in consultation with Prime Minister Sheikh Hasina, he added.

The tenure of most of the directors and the chairmen of four SCBs ---Sonali Bank, Janata Bank, Agrani Bank and Rupali Bank --- expired in early September last. The government reappointed all four chairmen of the SCBs for a period of one to two years in mid-September.

The Ministry of Finance (MoF) also reappointed four directors to four SCBs for a period of two years.

Besides the SCBs, most of the posts of directors in state-owned specialised banks - Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank (RAKUB), Ansar-VDP Bank, BASIC Bank, Bangladesh Karmashangthan Bank and Bangladesh Development Bank have also been lying vacant for long, sources said.

Officials at MoF said they have received a list containing the names of potential bank directors from the Prime Minister's Office (PMO) recently. A few individuals who became controversial as directors of a number of SCBs, including those on the board of Sonali Bank Ltd, have also found a place in the list, sources confirmed.

News: The Daily Financial Express/Bangladesh/07-Nov-12

The banks opened total 18 EHs for mobilising remittances. In this backdrop, the Bangladesh Bank (BB) issued warning to the parent banks to cancel licenses if the EHs could not reach to at least break-even point by a three-year timeframe by accelerating their drive for mobilising remittances.

The BB source said the EHs could not perform well in the UK because of persistent economic recession there that implies increase of unemployment rate and a fall in overall individual income. “As a result, EHs could not cover operational costs from their incomes.

An EH is supposed to run its operation by earning commission by channeling remittances,” said a high official of the central bank Tuesday. “But we found poor monitoring by banks,” he said adding, For this we adviced respective managements to shut down the losing EHs if they could not expedite endeavors for mobilising higher remittances for the country,” said the official, seeking anonymity.

According to the source, only two EHs in the UK are performing well. Of them, one house belongs to the state-owned Sonali Bank and another to NCC Bank Ltd. By obtaining approval from the central bank, the commercial banks have opened EHs in the UK, a priority choice of Bangladeshis who are leaving country for employment, emigration and education as a destination.

According to BB source, EHs namely NBL Money Transfer (UK) Ltd, IFIC Money Transfer (UK) Ltd, Prime Exchange Company, EXIM Exchange Company, Southeast Financial Services, Standard Exchange Company, Pubali Exchange Company, Premier Exchange Company, Jamuna Exchange Company, Bank Asia Exchange Company, Brac Sajjan Exchange, AB Exchanger, MTB Exchange, Mercantile Exchange House, EBL Exchange (UK) Ltd and Dhaka Exchange Company Ltd are running in losses.

Sources said the central bank is pursuing commercial banks for last couple of years to accelerate drives for mobilising remittances from Bangladeshi nationals living in different destinations (abroad) by providing hassle-free services at their doorsteps. In last couple of years, the BB authority issued licenses for 65 EHs in different countries including the USA, the UK, Malaysia, Singapore, Canada, Italy, Greece and Maldives.

Only 26 are in commercial operations while others are yet to starts functioning, according to BB sources. Besides, some 37 local banks have over 1000 drawing arrangements (contact with different EHs of various foreign banks in different countries) in 23 countries in order to provide facility to the Bangladeshi expatriates to remit money into the country at lower cost.

News: The Daily Sun/Bangladesh/07-Nov-12

Mohammed Nurul Amin, Managing Director of NCC Bank, inaugurates an ATM booth at Civil Station Road in Rangpur recently.

NCC Bank Limited opened two ATM booths at Civil Station Road, Rangpur and Patgram Bazar, Lalmonirhat recently.

Mohammed Nurul Amin, Managing Director and CEO of the Bank inaugurated the booths as chief guest, said a press release Tuesday.

Among others, Md. Matiur Rahman, Senior Vice President, Md Omar Faruque Bhuiyan, Executive Vice President and senior officials of the Bank were present.

News: The Daily Sun/Bangladesh/07-Nov-12