The 479th meeting of Executive Committee of the Board of Directors of Al-Arafah Islami Bank Limited was held at the Board Room of the Bank on 19 March, 2015. Alhajj Abdus Samad, Chairman of the Committee presided over the meeting. The Meeting reviewed overall business performance of the Bank, reports a press release.
Vice Chairman of the Committee Alhajj Abdul Malek Mollah, Members Alhajj Nazmul Ahsan Khaled, Alhajj Hafez Md. Enayet Ullah, Managing Director of the Bank Md. Habibur Rahman, Board Secretary Md. Mofazzal Hossain, Deputy Managing Directors Kazi Towhidul Alam, Mohammad Abdul Jalil, Md. Fazlul Karim, Muhammad Mahmoodul Haque and other Executives were present in the meeting.

Bangladesh Bank yesterday unveiled a new policy to provide good borrowers with incentives, including a 10 percent rebate on interests, in an effort to eliminate wilful loan default culture.
Before this, the central bank formulated various policies to rescue struggling big borrowers but never did they come up with any institutional policy to encourage good lending culture in Bangladesh, the central bank said in a notice. 
The move comes nearly two months after the central bank approved a restructuring policy for large borrowers, providing them a maximum of 12 years to repay loans above Tk 500 crore.
While justifying the policy for large borrowers at the time, Bangladesh Bank Governor Atiur Rahman disclosed plans to prepare a rebate policy to reward borrowers who have repaid their loans on time.
The central bank yesterday came up with the definition of good borrowers. Good borrowers must not have any classified loans in the last three years.
In case of current loans, if borrowers make regular repayment for three consecutive years, banks will have to provide a 10 percent rebate on interests at the end of third year.
Against demand loans, banks will have to provide the same rebate on the interests to be accrued from the credit on the third year.  In case of term loans, banks will have to provide a 10 percent rebate on the interests to be realised on the third year. 
All borrowers will continue to enjoy the waiver every year afterwards. Besides, banks can extend additional credit on demand. 
The central bank has made it mandatory for banks to provide the incentives to all its clients, a move which was well received by bankers. 
“It's a good policy. It will motivate borrowers to remain regular on their instalments,” said Anis A Khan, managing director of Mutual Trust Bank. “Although the profits of banks will reduce to some extent because of the policy, we will still welcome it,” Khan told The Daily Star, adding that the policy might help bring a positive change in reversing the growing trend of wilful default culture.  
Now banks will have to make their customers aware about the incentives for being a good borrower, he added.

With faltering steps, an elderly customer navigates her way to the end of a queue in the bright, airy and revamped branch of Barclays Bank.
She looks at the self-service kiosks, notes the absence of traditional glass counters, spots staff dealing with enquiries via tablet computers and turns to her friend. “It’s bedlam in here,” she says.
She might not be a tech-savvy, time-pressed, financially proactive customer, but she probably visits the branch twice as often as somebody half her age.
So, how can the banking industry convince her that the modern counter-free branch with more screens than staff is going to serve her better than the more traditional bank?
The British Bankers’ Association, which represents the major UK banks, says there is a “revolution” taking place in UK banking. Smartphones, contactless cards and competition are changing the way customers use their bank, it says. It points to the fact that nearly £1bn a day is transferred using the internet. Transfers using mobile phones and tablets are up 40% in a year. But 67 million transactions a week still take place in bank branches, and the BBA says there is still a need for a High Street presence. “While the size of these networks will decline, High Street outlets will remain important for those bigger moments, such as when a customer takes out a mortgage, wants to assess their financial options or resolve a complaint,” the BBA says in a report on modern day banking. As a result it is inevitable that the way bank branches look and operate will alter, it adds. Such a move is referred to, in business-speak, as the “change curve” by Steven Cooper, the chief executive of Barclays Personal Banking.
He started his career as a cashier in a Barclays branch in London at the age of 16. Now, 28 years later, he has overseen the change that effectively strips away the very counters behind which he used to sit. “I did not want a pane of glass between the customer and Barclays. I want it to be open, friendly and more comfortable,” he says.
New technology has changed the bodywork of the branch, and it has altered the way the engine runs too. A more automated system ends the “soul destroying” work of processing cash and cheques, he says. Mr Cooper has abolished his old role of cashier. Since the start of October, branch workers have been known as community bankers. These members of staff are now seen wielding a tablet computer in branches, dealing with enquiries that cannot be resolved at the self-service counters.

The central bank has relaxed the provisioning requirements for banks against their investment in mutual funds in light of the deteriorating situation of the capital market.

Banks will not have to keep provision for losses against investment in mutual funds if the unit's cost price is equivalent to or lower than 85 percent of its net asset value (NAV) in current market prices, Bangladesh Bank said in a notice yesterday.

Earlier, if the cost price was Tk 10 per unit and its value dropped to Tk 5 in the market, the bank had to keep provision for the Tk 5 loss without considering the NAV of the mutual fund. Now if the NAV goes down to Tk 8.5 or less, the bank does not need to maintain any provision.

Bankers said many banks that have huge exposure to different mutual funds will get more investible funds, thanks to the BB's relaxed rules.

“This is a realistic move for banks at the moment,” Sayeed Ahmed, chief financial officer of Pubali Bank, told The Daily Star.

At present, about 40 closed-end mutual funds worth Tk 4,440 crore are listed on the Dhaka Stock Exchange.

Banks have exposure to Tk 1,125 crore worth of mutual funds, and most of the mutual funds' market value and NAV have gone down far below the cost price.

If the cost price of the unit is higher than 85 percent of the market value or NAV on the basis of current market price, banks will have to keep the provision by following two methods.

First, if the market value is equivalent or higher than 85 percent of NAV on current market price, banks will have to keep the provision by deducting the market value of the unit from the cost price.

Secondly, if the market value is less than 85 percent of NAV on current market price, banks will have to keep the provision by deducting the 85 percent of NAV on current market price from the cost price of the unit.

In case of open-ended mutual funds, banks will not have to provision losses against their investment if the cost price is equivalent or lower than 85 percent of the market value or NAV on current market price.

If the loss exceeds the ceiling of 85 percent, banks will have to keep provision by deducting the 85 percent of NAV on current market price from the cost price of the unit.