Banking
Islami Bank holds business dev confce
Engr. Mustafa Anwar, Vice Chairman, Islami Bank Bangladesh Limited, is seen at the Business Development Conference of Bogra, Rajshahi and Rangpur zones of the bank in Bogra on Saturday.
Engr Mustafa Anwar, Vice Chairman of the bank was present in the conference as chief guest, said a press release.
Mohammad Abdul Mannan, Managing Director of the bank presided over the conference.
Md. Habibur Rahman Bhuiyan, FCA, Deputy Managing Director and Head of Internal Control and Compliance Wing, Md. Shamsuzzaman, Executive Vice President and Engr. Mohammad Ali, Head of Assets Management Division attended.
SIBL organises business review meeting
Social Islami Bank Limited (SIBL) organised “Strategic Planning Session and Managers’ Half-Yearly Business Review Meeting” at its corporate office in Dhaka on Saturday.
Major (Retd) Dr. Md. Rezaul Haque, Chairman of the bank was present at the meeting as the chief guest, said a press release.
Md. Anisul Hoque, Abdul Mohit and Abdur Razzaque, Directors, and Md. Abdur Rahman, Chairman of Board Audit Committee and Director of the bank were present.
BB gives 11-pt instructions to Basic Bank as recovery plan
Bangladesh Bank has given 11 instructions to the Basic Bank to help it recovery from the collapse caused by irregularities unearthed by the central bank.
The state-owned Basic Bank suffered a jolt as central bank investigation found that about Tk,500 crore was misappropriated through corruption and unfair practices in lending, mainly through its three branches at Motijheel, Gulshan, Dilkusha and Shantinagar.
According to sources at the Bangladesh Bank, the main aspects of 11-point instructions include taking measures reducing its non-performing loan (NPL), strictly maintaining the central bank’s guideline in issuing any new loans, taking steps for realizing default loans and reducing its unnecessary expenditures.
Without giving any detail, a top official of the Bangladesh Bank informed that these instructions were given to the Basic Bank management after removal of its managing director and appointment of the new chairman.
“The central bank has asked the Basic Bank management and also the board of the bank to submit its progress report every three months regarding the implementation of the instructions,” said the official.
The Bangladesh Bank on May 25 removed the Basic Bank’s managing director Kazi Faqurul Islam on charges of irregularities and corruption. The bank’s another official Fazlus Sobhan was made acting managing director. —UNB
UK banks face break-up threat as watchdog plans competition probe
LONDON: Britain’s big banks could be broken up after the country’s new competition watchdog set out plans for an 18-month investigation into services for small business customers and personal accounts because of a lack of competition.
The Competition and Markets Authority said banks have not done enough to meet the needs of retail customers or small and medium-sized businesses, such as making it easier to switch banks or providing clear information on fees.
The review will mark the latest attempt to open up banking in Britain to more competition and is also likely keep the banks in the political spotlight ahead of next year’s election.
The CMA, which became Britain’s new competition watchdog in April, has the power to order a break up of banks considered too dominant, as well as so-called behavioral remedies, such as improving information given to customers.
State-backed Lloyds Banking Group and Royal Bank of Scotland, the biggest banks for both personal accounts and business banking, are most at risk of being told to cut their market share, potentially by selling more branches.
“Our studies have found that despite some positive developments, significant competition concerns remain which mean that customers may not be getting consistently good service and value from their banks,” Alex Chisholm, CMA chief executive, said. A full investigation had been widely expected. It would take about 18 months, so it would be early to mid-2016 before any remedies were proposed.
Britain’s big four banks, which also include Barclays and HSBC, hold 77 percent of the 65 million personal current accounts in Britain, and have 85 percent of the 3.5 million business current accounts and provide nine out of every 10 business loans, the CMA said.
Current or personal accounts brought in about 8.1 billion pounds ($13.8 billion) of revenue last year for the banks — or about 125 pounds per customer. Revenue from small business accounts was well over 2 billion pounds,the watchdog said.
Shares in RBS fell 1.7 percent by 1100 GMT, the weakest stock in the European bank index. Lloyds shares fell 0.7 percent and Barclays and HSBC were both weaker, broadly in line with the bank sector.
Lloyds and RBS are already being forced to sell more than 900 branches between them by European regulators.
Analysts said these two were unlikely to have to shed much more of their networks, but they could have to cut into pockets of strength. That could include business banking in Scotland, where RBS has 39 percent of the market and Lloyds 30 percent.
An investigation may also raise the threat of more political interference ahead of a general election due by May.
“A break up thesis will definitely make its way into political manifestos and news flow is likely to remain volatile for the banks in this space,” Bernstein analyst Chirantan Barua, said.
Ed Balls, shadow finance minister for the opposition Labour Party, wants to impose market share caps on banks and welcomed a possible full industry investigation. —Arabnews
BB to unveil farm credit policy tomorrow, MPS next week
Bangladesh Bank (BB) is set to announce two major policies ahead of the festival vacation for Eid-ul-Fitr, starting on July 28.
The central bank will announce the agriculture and rural credit policy for 2014-15 financial year (FY15) tomorrow (Monday), BB General Manager AFM Asaduzzaman told BSS on Saturday.
He said the BB would also announce its monetary policy statement (MPS) for the first half of the current FY15 on Sunday, July 27. Governor Dr Atiur Rahman would unveil the MPS at 11:30am at a press conference at the central bank headquarters in the capital city. The central bank is preparing the new MPS with special focus on some measures for increasing credit flow and spurring local and foreign investment, a BB official told BSS earlier. “There will be some measures to cut lending rate to create more demand for credit in the market,” he said.
Accordingly, he said the interest on bank’s deposit would also be reduced to protect the interest of both the people and banking sector.
The central bank in its two past MPS kept private sector credit growth to 16.5 percent to manage inflation at a comfortable level, which had been soaring due to high food prices. The inflation at the end of June dropped to a 17-month low of 6.97, creating the scope for credit expansion particularly to the productive sectors.
It, however, would prefer small and medium enterprises and similar sectors for credit expansion so money circulation on the market would not increase from non- productive spending, the BB official said. Besides, the central bank is expecting that the current trend of export and import would also help increase credit flow to private sector in the coming days.
The official said that the new MPS would have some measures to create scope of offering incentives to encourage both local and foreign investment. Economists, think-tanks and development partners earlier cautioned that the economy in the next few years would bump into some major challenges. The challenges are driving forward the country’s industrial sector by continuously attracting domestic and foreign investment.
Keeping in mind the long term goal of mobilizing investment from internal and external sources, the next MPS would propose incentive measures for investment in the productive sector, but with a balanced approach so the incentives would not hinder the growth of existing industries, the official said.
Apart from these new measures, the official said that the next MPS would stick to the old strategy to complement the fiscal measures, announced in the national budget for FY15.