The central bank has issued directives to the non-bank financial institutions (NBFIs) to raise their paid-up capital to Tk 100 crore  with immediate effect.
Bangladesh Bank (BB) has served a circular to all the NBFIs in this regard on Sunday. According to the previous BB circular, the paid-up capital for NBFIs was Tk 50 crore. "This decision has been taken to increase the risk management capabilities of the NBFIs," said a high official of the central bank's Department of Financial Institutions and Market, wishing not to be named. He said the central bank has taken a number of measures to institutionalise good governance in the NBFIs in order to build better management capacity with skilled and professional personnel, and ensure transparency, accountability and dynamism. Besides, in order to strengthen the financial base of such institutions, the central bank is working on  implemention of Basel-II.
"Hence, the BB has decided that the minimum equity base (paid-up capital + reserve) of any NBFI licensed under the Financial Institutions Act 1993 should be doubled from Tk 50 crore to Tk 100 crore," he said.
In the latest circular, the central bank has advised the NBFIs to collect paid-up capital by taking initiatives for issuance of IPO (Initial Public Offering) or right share or bonus share, in case of shortage of funds. 
According to the circular, the NBFIs were given a timeframe up to June 30, 2012 for full compliance to the central bank directives.
In the circular, the central bank has imposed an embargo on disbursement of profit in cash without fulfilling the paid-up capital requirements.
Under the central bank directives, the paid-up capital for the NBFIs was last raised from Tk 25 crore to Tk 50 crore in November, 2009.

News: the Independent/ Bangladesh/ 25-Jul-2011