Rejaul Karim Byron

Private banks logged as high as 90 percent growth in their operating profit last year, riding on a boom in stockmarket and an upward trend in external business.

Most banks marked a rise in profit, ranging from 50 percent to 90 percent, and a few posted more than Tk 1,000 crore profit.

On the last day of 2010, Friday, they sat to count the last one year's profit. Primary data of all these 30 private banks shows that their combined profit soared by 57 percent to Tk 13,203 crore last year, against Tk 8,000 crore in 2009.

Islami Bank Bangladesh, this year also, made the highest profit at Tk 1,143 crore. Besides, National Bank and AB Bank logged more than Tk 1,000 crore each.

Managing Director of Shahjalal Islami Bank Abdur Rahman Sarker told The Daily Star that the banks are involved in the stockmarket business in different ways -- they have opened their own brokerage houses and are also doing portfolio investment. As a result, a big amount of income is accruing to them from the share market.

Sarker said the banks' income from external business also went up as the world economy shook much off the recession jitters.

Senior Executive Vice President of Mutual Trust Bank AKM Shamim said the banks' income on account of fees and commission has increased. The strict monitoring by the central bank also pulled down the banks' classified loans, increasing their income.

From January 3 to December 30, the benchmark index of Dhaka Stock Exchange went up by 3,754 points, or 82 percent, to 8,290.

Bangladesh Bank (BB) data shows that the banks' total holdings in the share market were Tk 25,000 crore as of October 31 last year.

Many banks earned a big portion of their profit from the stockmarket, bankers said. A bank involved in Islamic banking made a profit of about Tk 400 crore last year. Of the amount, Tk 100 crore came from its brokerage business.

The external trade of the banks also started going up last year, with the world economy recovering from the recession.

According to BB data, import increased by about 34 percent in July-October of the current fiscal year, against a fall of about 15 percent in the same period last year.

On the other hand, export went up by 36 percent during the July-November period of the current fiscal year, whereas the country witnessed a fall by about 7 percent in such external trade in the same period a year ago.

The banks' non-interest income increased in line with the rise in import and export.

In the first six months of the last fiscal year, the non-interest income shot up by 39 percent.

Source: The Daily Star

ONE Bank Limited has opened its 50th branch at Moghbazar in the city on Wednesday.

Farzana Chowdhury, vice chairperson of the bank formally inaugurated the branch, said a press release.

Asoke Das Gupta, Kazi Rukunuddin Ahmed, directors of the bank, Farman R Chowdhury, managing director, senior executives of the bank and several elites and business persons attended the inaugural function.

Source: Daily Sun/ Bangladesh/ 01-Jan-2011

HSBC Bangladesh recently organised a time management workshop for the inter-bank dealers in Bandarban.

A total of 40 dealers from 12 commercial banks and the central bank attended the programme Titled “‘Time Management in Treasury World: Work-Life Balance’, said a press release.

HSBC Bangladesh Global Markets team has been organising similar workshops in Bangladesh aiming at developing the local markets, building a strong inter-organisation network and enhancing HSBC’s image among industry stakeholders.

Bashar M Tareq, head of global markets of HSBC Bangladesh conducted the workshop which was focused on the importance of effective time management in the fast-paced and often-stressful markets environment.

The participants engaged in lively discussions of real life experience from both home and abroad during the presentation sessions. Recommendations were devised, with collective acquiescence, on practical solutions to maintaining a healthy work-life balance.

Source: Daily Sun/ Bangladesh/ 01-Jan-2011

The 6th Extra-Ordinary General Meeting (EGM) of Bank Asia was held at the Institute of Diploma Engineers in the city yesterday.

A proposal to raise Tk 2.50 billion through issue of zero coupon bond to meet regulatory capital requirement was approved in the meeting, said a press release.

A Rouf Chowdhury, chairman of the bank presided over the meeting.

Vice Chairman Moh- ammed Lakiotullah, Directors Rumee A Hossain, A M Nurul Islam, Mashiur Rahman and Shah Md Nurul Alam, President and Managing Director Erfanuddin Ahmed and Deputy Managing Director Aminul Islam were present on the occasion.

A large number of shareholders attended the EGM.

Source: Daily Sun/Bangladesh/01-Jan-2011

The government has disbursed Tk 375 million in favour of Bangladesh Commerce Bank Limited (BCBL) to help raise the paid up capital of the bank to Tk 2 billion from the existing Tk 920 million.

The rest of the amount will be collected through offering rights shares aiming to strengthen the financial base of bank.

BCBL authority will issue a rights share at a ratio 1:1.25 of Tk 100 to increase the paid-up capital of the bank existing Tk 920 million to Tk 2 billion.

The banking division of the finance ministry issued a circular on Thursday regarding the issuance of rights share against the existing BCBL shares.

“We needed the fund badly to enhance its capital base,” said a senior official of the BCBL. He also said the bank will provide more facilities to its clients after enhancement of its capital.

Currently, BCBL has Tk 2.0 billion authorised capital and Tk 920 million paid-up capital.

Another official of BCBL said the government was supposed to release the said amount on December 20, but it was done on December 28 by the banking division, which was a violation of the Bank Company Act.

The government owns 32.60 per cent share of BCBL, of which 10.86 per cent is held by each of Sonali, Janata and Agrani bank Limited. The majority share of BCBL is owned by general investors.

Earlier, the Ministry of Finance decided to sell out its whole stake of BCBL, including 10.86 per cent shares of three state-owned banks held by BCBL. The decision of the ministry was recently sent to the cabinet division for approval.

The Prime Minister's Office also wants offloading the government stake, a banking division source said. A group of interested businessmen including a number of law makers have shown interest to buy the government's stake in BCBL.

BCBL has a capital shortfall of Tk 1.63 billion and provision shortfall of Tk 766 million as of June, 2010. The non-performing loan as of June this year was about 28 per cent of the outstanding loan of the bank, according latest data of bank.

BCIL started functioning as an investment company and continued its business until April 1992. Consequent upon its liquidity crisis, Bangladesh Bank suspended its operation in April 1992. As a result, the investors suffered a lot and the employees of the company rendered jobless.

Ultimately, to safeguard the interest of the depositors, employees and the general public, the government intervened and parliament passed an act in 1997 for the establishment of Bangladesh Commerce Bank Ltd.

The bank formally started operation form September 16, 1999 with the paid-up capital of Tk 920 million. Of the amount, Tk 300 million was provided by the government, Tk 100 million jointly by Sonali Bank, Janata Bank and Agrani Bank and the rest Tk 520 million by the depositors.

Presently, three directors represent depositors on the 12-member board of directors of the bank.

The BCBL has 25 branches employing 452 officers and employees.

Source: Daily Sun/ Bangladesh/ 01-Jan-2011