Bangladesh Bank will release one lakh pieces of new commemorative notes on Tuesday, marking the 40 years of Bangladesh.

Earlier, the central bank printed 50,000 commemorative notes and its governor Dr Atiur Rahman formally released those on December 26 on the occasion.

The central bank decided to reprint the commemorative notes following huge public demand, said a central bank official.

The notes will be available in all branches of central bank today and later it will be available in all commercial banks, too, the BB official said.

The Daily Sun/Bangladesh/ 10th Jan 2012

The High Court yesterday restricted functions of 11 directors of Social Islami Bank Ltd (SIBL) for allegedly holding the offices for 16 years defying the law.

In response to a writ petition, the court also issued a rule upon the Bangladesh Bank to explain in three weeks why it should not be directed to remove the 11 directors from the offices of directors of SIBL.

The restriction on functioning by the directors will continue till disposal of the rule, the court said.

The directors of SIBL against whom the order was passed are -- Anisul Haque, Abdul Awal Patwari, Sultan Mahmud Chowdhury, Nasir Uddin, Sheikh Md Rabban Ali, Sayeedur Rahman, Jabbar Mollah, Faisal Ahmed Patwari, Noor-A-Alam Chowdhury, Lily Amin and Md Azam.

Rakimul Al Mamun, a share holder of SIBL, yesterday filed the writ petition with the HC saying that the 11 directors have been holding their offices for long 16 years violating the Banking Company Act 1991.

As per provisions of the law, no director can hold the office for more than six years continuously, the petitioner said.

He said the directors are allegedly involved in misappropriating the Bank money.

He prayed to the court to direct the central bank authorities to remove them from their offices.

The HC bench of justice AHM Shamsuddin Choudhury Manik and justice Jahangir Hossain Selim came up with the order and the rule after holding hearing on the petition.

Advocate Manzill Murshid appeared for the petitioner, while Deputy Attorney General ABM Altaf Hossain represented the government.

The Daily Star/Bangladesh/ 10th Jan 2012

The central bank suggested the government should take special credit from oil exporting countries to buy fuel to reduce mounting pressure on the country's foreign exchange, a top official said yesterday.

“We've already conveyed the message to the government for the special credit for Bangladesh Petroleum Corporation (BPC),” the official said, asking not to be named.

However, BPC Chairman Abu Bakar Siddique said he was not aware of any new move.

Siddique said BPC received special credit from the Islamic Development Bank and a syndicate of three foreign banks operating here. “I have no further information.”

Bangladesh Bank is in trouble trying to maintain a benchmark reserve of foreign exchange.

The local currency has been depreciating fast and reached nearly Tk 83 for the dollar Sunday from around Tk 70 a year ago.

The BB said the government may initiate talks to Qatar, Kuwait and other oil exporting countries to give it a credit line or a deferred facility to support its oil imports.

This kind of credit facility is not new. Many countries take such credit when in need. Sri Lanka got interest-free credit in 2009 and 2010 for crude oil import from Iran.

The pressure on the economy now stems from oil imports to feed rental power plants. The import of fuel oils rose by 92.44 percent to $2.20 billion in the first five months of the current fiscal year from $1.15 billion in the same period the previous year, according to BB data.

The oil import bill would cross $6 billion at the end of this fiscal year compared to less than $3.5 billion last year.

“We fear if the oil prices go up due to the Iran issue, things will worsen further,” said the BB official.

Iran has threatened last month to shut the Strait of Hormuz, a transit point for a fifth of oil traded worldwide, if sanctions are imposed on its crude exports. The BB fears the fiasco may fuel oil prices and pile pressure on its reserve.

Bangladesh raised fuel prices last month, which was the fourth such hike since May in a bid to reduce subsidy burden, ignoring that it would add to the rising inflation.

The Daily Star/Bangladesh/ 10th Jan 2012

M Shahjahan Bhuiyan

United Commercial Bank Ltd (UCB) continued to achieve significant growth in the 'core banking businesses' in the calendar year ended December 31, 2011.

The Bank's profit from 'core banking' registered a 34 per cent rise during the period.

"Despite some odds in the internal and external economic areas, our Bank has been able to achieve the growth due to efficient management and concerted efforts of our team members," M Shahjahan Bhuiyan, managing director of the bank told The Financial Express in an interview recently.

UCB achieved 23 per cent growth in advance in the year ended December 31, 2011 against the corresponding period of 2010. The growths in deposit and operating profits (unaudited) were 22 per cent and 20 per cent respectively.

The Bank earned Tk 6.6 billion as operating profit in 2011 while the advance and deposit were Tk 114.90 billion and Tk 137.80 billion respectively in the same period.

Commenting on the future outline of the Bank, the UCB MD said the bank is going to complete the installation of core banking software (CBS) as soon as possible.

"It is impossible to survive in today's competitive market without CBS and that's why we have listed completion of CBS as one of the top priorities of 2012," Mr Shahjahan added.

He said coming out of 'early warning category' list of Bangladesh Bank, conservation of adequate capital under Basel-two, strengthening the capital-base, beginning the electronic fund under BEFTN, introduction of off-shore banking, adoptions of agriculture credit policy and green banking policy were the benchmark achievements of UCB in 2011.

Putting a thrust on 'organic growth', the UCB MD said dependence on highly sensitive corporate deposit should be reduced enhancing the retail deposit collection flow.

"With the opening up of economy and privatization in early 1983, UCB was one of the first generation private sector commercial banks, among handful of others that came into existence. The performance of UCB as a first generation bank, over the years, may be adjudged as praiseworthy in spite of the absence of adequate regulatory framework and suitable business model in the early days of privatization," Mr Bhuiyan said.

Mr Bhuiyan, one of the senior most banking professionals of the country said banking business of today has become more complex and is filled with uncertainties, changes and challenges due to newer dimension of national and global business and the economy at large.

"In order to deal with these complexities and challenges we need adequate preparedness. We are proud to say that UCB is successfully facing these challenges through capacity building at the group and individual level by development of skill, efficiency and up-gradation of performance ability in keeping up with the transformation in the banking industry."

"The New Management of the Bank having clear focus of the critical challenges that lies ahead has been continuously predicting the changes in the global as well as national economic cycles and making required adjustments in business strategies. Thus, a new success story was unfolded from July'2008 spearheaded by strong and effective leadership, direction and guidance of me," Mr Bhuiyan asserted.

There was slow growth of all business parameters up to the period of June, 2008 and then a sharp rise began in all business parameters from July, 2008 and beyond.

"Almost all the renowned business houses are now doing business with UCB which was possible due to our customer- friendly business policy and prompt decision making process. We have also developed business relationship with some renowned exchange houses abroad for increasing inward remittances," Mr Shahjahan said.

"In the perspective of Bangladesh, there is an immense opportunity of Off-Shore Banking for UCB with its proven capacity and capability in international trade," the UCB MD said.

Other than change in business performance, there were major changes in Bank's operation through introduction of new policies and amendment of existing policies.

"We have introduced policy and guidelines in every aspect of banking activities including initiatives to ensure sustainable and profitable business growth through development, acquisition and retention of potential human resources and high yielding customers by institutionalizing relationship banking across the Bank through building a team of dedicated, efficient and professional workforce; harnessing their core competence with good business practices, decipher market oscillations and exploit latent opportunities to remain ahead of others," he said.

"We do strongly believe that this miraculous success story has been possible because of our visionary business policy, all out drive by our executives and officers and relentless effort round the year and all these initiative we have taken will help us to be key market player towards making our dreams a reality," the UCB MD said.

The Daily Financial Express/Bangladesh/ 9th Jan 2012

Bangladesh Jute Association (BJA) Sunday demanded a moratorium for 10 years on bank interest of raw jute exporters. The amount is now worth above Tk 1.0 billion due to sluggish export performance of raw jute. The interest has accumulated with banks over a period of one decade.

The BJA leaders also demanded declaring 'raw jute' as an agriculture product so that exporters get subsidy against their export receipts.

The demands have been placed to Finance Minister AMA Muhith at a meeting between the minister and BJA leaders. The BJA chairman Mahfuzul Hoque led the delegation.

The BJA in its demand said the accumulated interests may be transferred to 'Blocked Account' in banks.

Mr Mahfuz, after the meeting, told the reporters that the Finance Minister had assured them of considering their demand as the raw jute exporters are in dire straits.

"We are in bad shape. If the government does not extend its cooperation in bailing out the raw jute exporters, we will be nowhere," Mahfuzul told the reporters.

The country exported raw jute worth $357 million in 2010-2011. The export earning during July-December of the current fiscal year was $125.37 million, down by 32.11 per cent from the amount of the same period in the previous fiscal year.

The BJA chairman said they have been exporting raw jute for less than the prices at which they bought it from farmers causing huge losses to exporters.

"If the government does not come forward with a rescue package, the raw jute export will no longer exist," Mr Mahfuz told the reporters.

He said the bank interest should be reduced to 10 per cent for jute exporters, which now ranges between 13 and 15 per cent.

Lamenting the government policy, the BJA chairman said the Ministry of Agriculture recognises raw jute as an agriculture product, but the Ministry of Finance does not.

The Daily Financial Express/Bangladesh/ 9th Jan 2012