Sonali Bank has taken some initiatives to beef up security system for branches across the country.

The state-owned bank took these initiatives following two recent incidents of burglary in its two branches that cost the bank a huge amount of cash as well as business goodwill.

The finance ministry also formed a six-member committee on Monday to review the security of the vaults of the state-owned banks (SoBs) including Sonali.

Headed by Banking Division Additional Secretary Amalendu Mukherjee, the committee includes an executive director of Bangladesh Bank and four deputy managing directors from the four state-owned banks - Sonali, Agrani, Janata and Rupali banks.

The committee would prepare a report in two months time on the status of security of vaults of the SoBs and would also recommend measures for strengthening security further.

In a statement late Wednesday, Sonali Bank said it would install night vision closed circuit cameras in branches across the country in next 15 days. All the bank’s vaults will have 24-hour security alarm system soon. 

 Bangladesh Bank Governor Dr. Atiur Rahman emphasised on the need for establishing special economic zones for women entrepreneurs so that they can come forward and participate at the country’s development process.

He also called upon everybody to change their mindsets towards women and said wrong mindset about women is one of the major challenges that hampers their success both in social and business lives.

Atiur came up with the call while addressing as chief guest the inauguration of a day-long ‘Women Entrepreneurs Conference and Products Display” held at Ruposhi Bangla Hotel in the capital on Thursday.

The SME and Special Programme Department of Bangladesh Bank in cooperation with all banks, non-banking financial institutions, JICA, CARE Bangladesh and Standard Chartered Bank arranged the programme in order to encourage women entrepreneurship by speeding up financing to the projects undertaken by women entrepreneurs.

Abul Kashem, Deputy Governor, Professor Hannana Begum, Director of Bangladesh Bank, Mikio Hataeda, Chief Representative of JICA Bangladesh, Jamie Terzi, Country Director of CARE Bangladesh, Kazi Akram Uddin, President of the Federation of Bangladesh Chambers of Commerce and Industry, Ali Reza Iftekhar, President of the Association of Bankers, Bangladesh, Rokia Afzal,

 President of Metropolitan Chamber of Commerce and Industry, Mohammad Shahjahan Khan, President of Dhaka Chamber of Commerce and Industry addressed the programme as special guest.

Nirmal Chandra Bhakta, Executive Director of Bangladesh Bank chaired.

The participation of women in managerial posts of different organisations has been increased remarkably, Dr. Atiur said mentioning that women participation which was 19 percent in the managerial posts 10 years earlier has now jumped to 24 percent.

“Financing the projects of women entrepreneurs would be profitable investment for the banks, now-a-days,” Atiur said.

“The women entrepreneurs are never get defaulters. After taking loans from the banks they repay it in time which is a great opportunity for the banks to invest,” he added.

Addressing the programme, Kazi Akram Uddin informed that there are seven women chambers in the country now. 10 other applications to establish women chambers has also been submitted. He hoped that women chamber will established at every districts of the country.

Calling upon the women to come forward to invest in productive sectors, Akram also emphasized on the necessity of changing everybody’s mindset in this connection. Women are investing in many sectors which are generating huge employment also also contributing lot to the country’s economy, said Abul Kashem.

Calling upon the government to institutionalise women entrepreneurship, Rokia Afzal said that women are facing various obstacles in doing business.

Jamie Terzi said that the uplift of female community is the major provision of entire development of a nation while it is necessary to involve the women in economic activities to enjoy such development.

Mentionable, around 500 women entrepreneurs participated in the conference to display their products and services. A total of 78 stalls were set up at the venue where the entrepreneurs displayed their products.

Actions will be taken against respective banks if the inspection teams find any breach of safety directives made by the central bank.

Jebun Nesa Alo

Bangladesh Bank has decided to launch a massive monitoring to ensure security of bank vaults across the country.

Actions will be taken against respective banks if the inspection teams find any breach of safety directives made by the central bank, it said.

In the wake of two recent burglaries in Sonali Bank, the central bank came up with the decision at a meeting yesterday held at its office in Dhaka.

The bank inspection department of Bangladesh Bank will check vault safety measures.

The inspection will be conducted in addition to the department’s regular inspection to financial activities of different bank branches.

"If any branch is found vulnerable and not complying with the Bangladesh Bank directive on safety issue, punitive action will be taken," said Deputy Governor SK Sur Chowdhury.

Bangladesh Bank issued a circular on January 27 asking all the banks to take every necessary stepto ensure their vaults’ safety.

Following the burglary in Sonali Bank’s Kishorganj branch, the circular was issued.

It mentioned that most of the banks didn’t follow the central bank’s instruction on safety of depositors’ money kept at vaults despite repeated warnings from Bangladesh Bank.

Thus, the negligence in safety steps had resulted in looting of depositors’ money breaking into the bank vaults, the central bank added.

If Sonali Bank stepped up vault security after the Kishoreganj branch heist, the following incident of same kind at a Bogra branch of the bank could have been avoided, according to Bangladesh Bank.

On Tuesday, the central bank served a notice to Sonali Bank’s managing directorPradip Kumar Duttato let it know what safety steps were taken after the Kishoreganj branch burglary.

While talking with the Dhaka Tribune, Pradip Kumar Dutta didn’t answer to the question if any additional security steps were taken after the Kishorganj incidence in January.

Rather, he talked about the insurance coverage of the vaults and relocation of branches as part of security efforts.

“Sonali Bankcancelled insurance policy for its vault safetyafter the government’s instruction as premiums were costing huge amounts to the bank,’’ said Pradip Kumar Dutta said.

He said letter was to the government to revive insurance coverage, and the matter had been discussed with Sadharan Bima Corporation too.

As far as insurance coverage is concerned, the insurance on the money deposited at the vaults has to be covered completely.

Sonali Bank MD said to ensure vault security they would need torelocate many branches and it involved a long process.

“We have already begun it (relocation process). But for this interim period, we will have to increase securityguards.”

Under the structural security measures set by Bangladesh Bank, banks are to set up security-tested doors with steel wall around the vault space of the banks. The floors and roofs of around the vaults also have to be certified by an engineer.

As part of technical security measure, there must be an alarming system round the clock along with a closed-circuit television camera at the vaults.

There should be an uninterrupted connectivity between the bank’s central information system and the vault’s security system. Automated fire extinguishers also must be set up into the vaults.

An amount of around Tk16.4 crore was looted from Kishoreganj Sadar branch of Sonali Bank in Januarywhile more recentlyanother burglary hit a Bogra branch of the state-owned bank looting over Tk30 lakh.

News:Dhaka Tribune/13-Mar-2014

The central bank yesterday asked all commercial banks to pay import bills in time. The banks will be fined if they fail to do so, Bangladesh Bank said in a notice.
There have been complaints that some banks are making unwanted delay in paying bills against letters of credit, which is tarnishing the image of the country's banking system, the BB said.
The interest imposed on unpaid bills and the confirmation charges of the foreign banks go up due to the delay, making imports costlier.
“An increase in import costs due to such irregularities has a direct adverse impact on the prices of essential commodities and hampers public interest,” the BB notice said.

News:The Daily Star/13-Mar-2014

The government has instructed the four state-owned commercial banks (SoCBs) including Sonali, Janata, Rupali and Agrani bank to invest their excess liquidity to the treasury bonds to reduce the ideal money from banking sector. The finance ministry also instructed the SoCBs to declare their excess liquidity to the finance ministry as well as the central bank. The finance ministry made the direction after a meeting with high officials of various banks especially the state-owned banks. The meeting was presided over by the additional secretary of Banking and Financial Institution Department of Finance Ministry, Gokul Chand Das.
Until November last the SoCBs' excess liquidity stood at Tk 343.94 billion against the entire banking sector's excess liquidity of Tk 901.66 billion.
Banking source said that banks could invest up to 81 per cent of their liquidity. Until November last the Sonali Bank invested 49 per cent, Janata Bank 63 per cent, Agrani Bank 63 per cent and Rupali Bank 61 per cent of their liquidity.
The central bank Executive Director M Mahfuzur Rahman told The Independent that the idle money of banking sector increased due to the political turmoil across the country over the last of months, especially before the last general elections. During the political unrest, a good number of banks failed to disburse their money on big project and large volume industrial loans.
Commenting on Sonali bank’ excess liquidity, he said that the bank is one the largest financial institution of the country. “If a significant portion of its fund remains idle, the bank will incur a heavy loss and employment generation will be affected”, said the executive director.
He expected that excess liquidity form banking sector would gradually decrease as the country’ political situation is now quite stable and banks are trying to fulfil their disbursement targets. The central bank also instructed banks to invest their money in productive sector to reduce excess liquidity, he also added.
Moreover, the government is going to reintroduce two-year treasury bonds to facilitate public borrowings and make the securities market vibrant. The government has set a target of borrowing Tk 7 billion through treasury bonds from the banking sector in the remaining period of the current fiscal year ending on June 30, he also said.
Another central bank official said the central bank still needs more information to have complete scenario of the banks’ health and is on move to collect more information about excess liquidity.
Obayet Ullah Al Masud, Deputy Managing Director of Rupali Bank said that his bank is not a member of Primary Dealer banks. Without membership of PD, bank can not invest their money in treasury bonds. The bank official demanded for the membership of PD banks for Rupali banks to invest their money in treasury bonds.
Meanwhile, the ministry directed the SoCBs to submit their investment proposal in different bonds within a week. The ministry also directed Rupali bank to take necessary steps for the membership of AD banks so that they can invest their money in the treasury bonds.
Banking source said that the rate of interest of the Treasury bond is low that is why a good number of banks are discouraging to invest in government bonds. Banks deposit rate is higher than the interest of government bonds, so it is very tough for banks to invest their deposited money into the government bonds, pointed Saiful Islam Patwary, manager of First Security Islami Bank, Dilkusha branch.
Talking to this correspondent, renowned economist, Professor Abu Ahmed pointed that there is no obligation to invest in treasury bonds which is fully depended on bank’s financial condition. He said that investment by force in government bonds is unethical. The economist urged the government to offer higher interest rate to the treasury bonds to encourage banks to invest more in the bonds.
Business people, however, expressed a different view. While talking to this correspondent Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) vice president Md Helal Uddin said that economy would face a huge challenge if the deposited money of the investors invested in the government bonds.
Private sector development would hamper if the excess liquidity is invested in treasury bonds, the business leader also pointed out.
He said that the business community is now availing the loan facilities at the rate of 20 per cent across the country. “It is very hard to establish the industry as well as operating the business by this hard term loan”, said the FBCCI vice-president. He demanded bank loans, with single digit interest, for entrepreneurs to have a smooth business.
The FBCCI vice president also pointed out that a good number of businessmen took the loan facility from foreign fund at the rate of 5 per cent which is more profitable for them. He suggested that banks have to allocate low interest loan to reduce the excess liquidity which, he said, would benefit the businessmen community as well as the economy.
At present various types of treasury bonds are available in the market having various durations. PD banks, financial institutions and insurance companies are the customers of treasury bonds. The care taker government banned the two-year period treasury bond. Bank officials,
however, suggested reintroduction of two-year bonds as it was to encourage short term investment.
According to banking sources, the government usually take bank loans by purchasing treasury bonds to meet its budget deficit. It is a long term investment.

News:The Independent/13-Mar-2014