After nearly two years, the central bank yesterday resumed the auction of its 30-day bill to mop up excess liquidity from the money market, Bangladesh Bank (BB) officials said.

According to BB data, three foreign commercial banks -- Standard Chartered, HSBC and Citibank NA -- bought the BB bills worth Tk 180 crore against 9.40 percent interest rate.

Along with three foreign banks, local Dutch-Bangla Bank participated in the auction. A total of six bids worth Tk 455 crore were received, of which, three bids worth Tk 180 crore were accepted.

BB data showed the previous auction of the 30-day BB bill was held on November 29, 2010 when no institutions participated in the auction due to a severe liquidity crisis .

“The situation (liquidity crisis) has eased recently. So, we can expect that banks and non-banks will participate in the auction,” said a BB official.

The official said the BB resumed the bill to mop up the surplus liquidity from the money market to help the foreign exchange market become stable.

“More liquidity in the market could make the local currency depreciate against the US dollar,” he said.

From now on, the auction of 30-day BB bill will be held every Monday in a week, he said.

BB usually holds bidding to sell government treasury bills and bonds every week to help the government borrow from the banking sector.

News: The Daily Star/Bangladesh/13-Nov-12