Bangladesh Bank has selected Jamuna Bank as the best primary dealer (PD) of Bangladesh for its outstanding performance in the government securities market during the last quarter (October-December) and paid the bank Tk 2.85 crore as underwritting commission. The central bank announced this recognition through a letter to the bank authorities recently noting that the underwriting commission money given by the central bank has been transferred to the bank’s account last week.
Jamuna Bank, a leading private commercial bank has been playing vital role in treasury operations of the country’s banking arena. The bank is eqquipped with a very sophosticated treasury rooms and a number of talent young dealers who contributed nearly 40 per cent of its profits which was recorded Tk 254 crore in 2010, compared to Tk 202 crore in 2009.
Terming the central bank recognition as an ‘encouragement toward further improvement’, Mirza Elias Uddin Ahmed, Senior Executive Vice President and Head of Treasury of Jamuna Bank Ltd said this is the first recognition for the primary dealers in Bangladesh who are trying to develop a sound, efficient and vibrant secondary market for government securities.
Currently 12 banks and 02 financial institutions have obtained primary dealership and have formed association named as primary dealers Bangladesh limited (PDBL). The other PDs are Sonali Bank, Janata Bank, Agrani Bank, Jamuna Bank, NCC Bank, Prime Bank, National Bank, Uttara Bank, Southeast Bank, Mutual Trust Bank, AB Bank, Mercantile Bank, Lanka Bangla Finance and Industrial Promotion and Development Corporation(IPDC).
Bangladesh Bank has selected NCC Bank as the second best primary dealer in Bangladesh while other banks and FIs failed to meet the requirements during the period.
“Today’s treasury environment is more challenging than ever. But Jamuna Bank could overcome the difficulties due to prudent guidence of our managing director who is also expert in crucial fund management, said Elias Uddin Ahmed, who is also the former chairman of PDBL Technical Committee and Secretary General of  Bangladesh Money Market Dealers’ Association (BAMDA).
“If the central bank extends its policy supports to us, we would very soon develop a secondary market for government securities and bonds which would excelerate the development activities of the country”, he said.
Jamuna Bank started its journey in 2001 with a paid up capital of Tk 40 crore and obtained primary dealership in 2003. Excellent management performance, prudent credit policy and higher returns of quality assets helped the bank to stand on a sound financial footing. In 2009, the bank declared 23.50 per cent dividend to its shareholders while its capital shot up to Tk 162.19 crore.
Primary dealers are market maker of government securities and able to make business deals with the Bangladesh Bank. They purchase the majority of treasuries at auction and then redistribute them to their clients, creating the initial market in the process. Such dealers must meet certain liquidity and quality requirements.
Primary dealer systems are present in many countries including India, Malaysia, Canada, France, Italy, Spain, the United Kingdom, and the United States. Many former employees of primary dealers work at the Treasury, because of their expertise in the government debt markets.

News: the independent/ Bangladesh/ Mar-03-2011