DHAKA, SEPT 16: Bangladeshi private commercial bank IFIC is all set to buy a majority stake in Nepal Bangladesh Bank Limited, a leading commercial bank in the land-locked Himalayan state.

“The IFIC will purchase a 51 per cent share in the bank and take the responsibility of operating it,” said Mohammad Lutfar Rahman, chairman of Nepal Bangladesh Bank Limited.

As many as 42 per cent shares had already been purchased and the remaining 9 per cent would be bought very soon, he added.

Lutfar was appointed the chairman of Nepal B in February this year. Lutfar was the first Bangladeshi national to become the chief of aangladesh Bank foreign bank.

A fully general commercial bank, not only limited to dealing with business between Bangladesh and Nepal, Nepal Bangladesh Bank has a bright future as it made a profit of Nepalese Rs. 135 crore last year, Lutfar said.
Lutfar Rahman said that they started investing the money abroad after obtaining formal permission of the Bangladesh Bank. The foreign currency was transferred from the Bangladesh Bank to the Reserve Bank of Nepal.
Currently, the bank has a total of 21 branches spreading across Nepal. 

It has plans to increase the number of branches to 26 very soon. The Nepal Bangladesh Bank Limited was established in 1994, in collaboration with IFIC. 

Earlier, the IFIC held a minority stake in the foreign bank. The bank was launched with the goal of becoming the bank for everyone in Nepal.

Over the years, it succeeded in increasing the paid up capital to Rs. 2 billion. It is headquartered in New Baneshwor, Bijuli Bazar, Kathmandu. With a network of 21 branches spread across Nepal, the Nepal Bangladesh Bank has a chain of 28 ATMs. 

The bank also provides holiday banking and has launched services like e-banking, mobile banking, e-top-up service, branchless banking and other e-products.

It has also launched a special deposit product for women.
According to sources,

the bank has made its services available to almost all the top business houses. 

Nepal’s top exporters and importers have relationships with the bank with a substantial volume of foreign business, which has enhanced the bank's popularity in the international trade font.

 NRB Bank recently opened a branch at Gulshan in Dhaka.

Dr. Gowher Rizvi, Adviser to the Prime Minister, inaugurated the branch as chief guest, said a press release on Monday.

Iqbal Ahmed OBE, Founder Chairman, NRB Bank Limited, Muklesur Rahman, Managing Director and CEO of NRB Bank Limited and other senior officials of the bank were also present.

While speaking, Dr. Gowher Rizvi congratulated the inception of NRB Bank in Bangladesh with the promise to support entrepreneurship and connect Bangladesh with the international market.

Iqbal Ahmed OBE, Founder Chairman, NRB Bank Limited said, "I dream of unlocking a new horizon to the Bangladesh economy by facilitating NRB inward investment to Bangladesh and assisting Bangladeshi enterprises to access international markets and also delighted to start our first branch operation at Gulshan."

Muklesur Rahman, Managing Director and CEO, NRB Bank Limited said, “At NRB Bank, we would like to position our-self as the destination of opportunities and making it the next growth frontier.”

Standard Chartered Bank, for the 5th consecutive year, has been named the “Best Foreign Commercial Bank in Bangladesh” by FianaceAsia, a leading financial publication in the region.

The bank received FinanceAsia 2013 Country Awards, a prestigious award for its achievement in the banking field, said a press release.

Jim McCabe, Chief Executive Officer of Standard Chartered Bank Bangladesh received the award at FinanceAsia 2013 Country Awards Gala Dinner at Hotel Fort Canning in Singapore Thursday.

Jim McCabe said, “We are delighted with this win, and we’re excited by the future for Standard Chartered Bank in Bangladesh. We are thankful to all our clients and colleagues of the bank for their support in winning this prestigious award once again.”

“Standard Chartered Bank is the largest foreign bank in Bangladesh with 26 Branches and Booths, 97 ATMs and 19 Financial Kiosks, employing over 1,700 people,” he added.

Bangladesh Bank (BB) Governor Dr Atiur Rahman warned Sunday of a bumpy ride on the road to restoring financial stability.

"Financial developments over the last twelve months have clearly demonstrated that the road to continuing restoration of financial stability in the country will not be long, but may be a bit bumpy,"

the governor said while speaking at the lunching of the Financial Stability Report 2012 at the central bank headquarters in the capital city.

The Financial Stability Report is published once a year through which the BB assesses the stability and resilience of the financial sector and the policy actions it advises to reduce and mitigate risks to stability.

  
Dr Rahman said the financial sector of this country is more comfortable than other neighbouring countries, especially the banking sector, which became comparatively stable with the BB's special drive for financial inclusion.

He, however, noted that the management and the financial situation of all banks are not equally satisfactory.
The governor said the central bank had already issued some necessary guidelines,

brought changes in rules and regulations and strengthen its monitoring system. But, the implementation of the guidelines and rules and regulations were not "reassuring" in the field of operations.

He advised banks to strengthen their own monitoring to establish and ensure corporate good governance and restore discipline in banking sector.

In this regard, the governor prioritized on state-owned banks against the backdrop of their poor performance in loan management. The current Financial Stability Report shows non-performing loan in five public banks soared to 63.0 percent last year.

Dr Rahman suggested all banks arrange trainings of bankers and management staff at home and abroad involving local and foreign experts.

Commenting on the current report, the governor said the prime objective of publishing this report is to provide an overview of the possible sources of risks and vulnerabilities to financial stability and to play an important role in preventing financial crises.

Only five state-owned banks (SoBs) had 63 per cent of non-performing loans (NPL) in the country's banking system as on December 31 last due mainly to their inefficiency in fund management. 

"The classified loans in the state-owned banks are higher due to the nature of their operations (lack of efficiency in fund management, extending obligatory financing towards social and economical priority sectors and politically motivated lending)," the central bank said in its Financial Stability Report (FSR)- 2012, released Sunday. 

The Bangladesh Bank (BB) has taken different measures including signing of memorandum of understanding with three state-owned commercial banks (SoCBs) and two specialised development banks to improve their overall financial health. 

"We've taken stringent policy to reduce the amount of their NPLs," Deputy Governor of the BB SK Sur Chowhudry told reporters after releasing the report. 

The FSR also said default loans scenario has been improving, but still almost 67 per cent of NPLs is bad loans. 

Among the worst 10 banks, based on the NPL amount, four are state-owned commercial banks, three domestic private commercial banks, and three specialised development banks. 

However, among the worst 10 banks, considering the NPL ratios, three are state-owned commercial banks, two domestic private commercial banks, three specialised development banks and two foreign banks. 

"It is a matter of concern that two foreign banks have been included among the worst 10 banks based on the NPL ratios though their total loan amount is not so significant," the report noted.

The central bank has recommended policymakers to introduce consolidated supervision in the banking industry, develop resolution regimes for banks, strengthen cooperation among various regulators of financial intermediaries and more stringent supervision of banks and other financial institutions.

The Deputy Governor also said the banks will have to improve their internal control and compliance with ensuring accountability and transference. 

He also said the BB has recommended introducing risk-based capital adequacy framework for insurance companies in line with the Basel-II and developing risk management framework therein. 

The central bank found that factors which adversely affect the financial sector stability are capital market still demonstrating price correction with lack of confidence of the market participants, some financial soundness indicators of the banking sector such as profitability, capital adequacy ratio, and non-performing loans ratio.

Besides, there has been recurrence of various scams in financial institutions, particularly in banks, leading to confidence problem in the financial intermediaries and decline in real gross domestic product (GDP) growth rate, the report said.

Regarding risks, the FSR said credit risk represents 86 per cent of banking sector risk and only ten banks share 45 per cent of it. Market risk, on the other hand, was not vibrant but it generated mostly from the equity market. 

In 2012, the BB put increased emphasis on macro-prudential regulation, stringent on-site supervision and off-site surveillance of financial intermediaries, close collaboration among various regulators, together with increased risk awareness of the stakeholders of the financial system with a view to letting them withstand and adapt to plausible shocks well ahead of their potential materialisation, according to the report. 

"The overall macroeconomic environment was favourable, and the financial intermediation process demonstrated considerable resilience amid unfolding of some financial scams in the banking industry," it noted. 

"A series of efforts and policy actions by both BB and the government contributed to maintaining financial stability. Nevertheless, there is no scope to remain complacent." 

The report also said stakeholders of the financial system should remain aware of the potential risks and vulnerabilities with a view to withstanding and adapting to those accordingly.

BB Governor Dr. Atiur Rahman earlier unveiled the FSR giving emphasis on ensuring stability in the country's overall financial sector. 

He also said although there is no immediate risk in the stability of financial sector at micro level, the state of stability in all banks is not at the same level.

The central bank chief also noted that the BB has already issued detailed guidelines for banks regarding ensuring good governance in internal audit and control but their effective implementation is not reassuring at all.