Bangladesh Bank (BB) may give approval to launch five to seven new banks in the private sector Sunday. According to BB sources, the board of governors of the central bank is set to give nod to launch five to seven new banks proposed by the private entrepreneurs at its meeting on Sunday (today).

The board of governors of the central bank will meet this afternoon at the BB’s headquarters with its governor Dr Atiur Rahman in the chair.

Sources said, the central bank board might consider maximum six proposals out of 16 short-listed applications for setting up new private banks at the meeting in the face of tremendous pressure from the government high-ups.

Preferring anonymity, a senior BB official told this correspondent that of the short-listed 16 proposals, five banks remain at the top of the list which was prepared by scrutiny committee of the central bank for consideration.

The banks are: Union Bank Ltd, Modhumati Bank Ltd,
The Farmers’ Bank Ltd, South Bangla Agriculture and Commerce Bank and Midland Bank Ltd.

The promoters of these banks are former president HM Ershad, Fazle Noor Taposh, MP and Dr Mohiuddin Khan Alamgir, MP, SM Amjad Hossain and Moniruzzaman Khan Khandker.

The BB official said, the government high-ups had also been persuading the central bank to approve proposed banks, namely Chartered Bank

Ltd, Meghna Bank Ltd, Kotak Bangla Bank Ltd, People’s Islami Bank Ltd and Federal Bank Ltd.
He said several board members are against so many new
banks as, according to him, the present economic situation does not permit it.

He also argued that financial position of the existing banks was not good enough and most of them were facing various problems to run their business.

The official observed that the BB is bound to give its nod to issue licenses to launch new banks, as it was the government’s political agenda. Earlier on Wednesday, the BB governing body in its 329th meeting approved three new banks sponsored by non-resident Bangladeshis (NRBs).

The meeting that was adjourned till 1:30pm Sunday, however, did not give approval to new private banks.
The adjourned meeting would discuss all the 16 short-listed proposals for launching new banks and some of them may finally get nod of the board of governors of the central bank.

The BB, the country’s apex bank, sought applications for setting up new banks from the private promoters in September last year to fulfil the government agenda.

The central bank received 37 applications from the aspirants of the new banks till November 30 last year, last date of filing application.

For this reason, he apprehended, some board members of BB may not attend today’s meeting as they are not interested to involve with the process of approving new banks. The BB official also mentioned that two board members remained absent on the Wednesday’s meeting in the same ground.

Presently, a total of 47 public, private and foreign banks are operating in the country.
Meanwhile, experts have already expressed their concerns over BB’s move to give nod to float too many new banks under pressure from thegovernment.

They said the decision of setting up new private banks in the present economic context of the country would be unwise because business of banks’ has already been saturated in the country.

The Independent/Bangladesh/ 8th April 2012