The expansion of credit flow to the private sector witnessed a rising trend in February 2012, following increased trade financing, after facing fall in the past few months, bankers said.

The rate of private sector credit growth rose to 19.55 per cent in February from 18.94 per cent in January, according to the central bank statistics, released Thursday.

"It's a temporary phenomenon," a senior official of the Bangladesh Bank (BB) told the FE, adding that the private sector credit growth has already recorded a declining trend in March.

The credit flow to the private sector rose to Tk 622.29 billion in February 2012 on a year-on-year basis from Tk 702.79 billion in the corresponding month of the previous year, the BB data showed.

Bankers, however, said the credit growth to the private sector increased slightly during the period under review, mainly due to the rise in trade financing, particularly for scrap-vessels.

"Higher import of scrap-vessels has pushed the credit flow to the private sector to some extent in February last," a senior official of a leading private commercial bank (PCB) told the FE.

The import orders for scrap-vessels increased by 123 per cent to $134.49 million in February 2012 from $60.26 million in January 2012, while the letters of credit (LCs) against imports worth $66.82 million were settled in February against $83.28 million in January. 

The private banker also said the credit flow to the private sector may fall in the coming months, as most banks are not interested to open LCs for less important products, like consumer and luxurious goods, in line with the central bank's advice.

The BB earlier asked the commercial banks to discourage extending credits to less productive sectors for reining in the inflationary pressures on the economy.

The central bank unveiled a 'restrained' monetary policy on January 26, aiming to bring down inflation to a single-digit from the current level of over 10 per cent through discouraging credit flow to unproductive sectors.

Financial Express/Bangladesh/ 6th April 2012

Eastern Bank Ltd (EBL) and Navana Ltd, a brand automobile distributors of the country, have signed a MoU in the city recently, says a press release. Muklesur Rahman, deputy managing director of EBL, and Saiful Islam Shumon, senior vice-chairman of Navana Ltd, signed the MoU.

Ali Reza Iftekhar, managing director and chief executive officer of EBL, was present.Under the MoU, EBL will provide up to Tk 20 lakh automobile loan to Navana customers without any processing fee within five working days at a discount than the usual interest rate.

On the other hand, EBL Auto Loan customers will enjoy special discount on various automobiles at Navana showrooms, discount on Navana battery and lubricants and other value added sales and after sales services. Navana CNG will also offer discount to customers.

EBL Auto Loan is repayable within 60 months and with an option of early full and final settlement.Among others, Anwar Hossain, head of asset, Nazeem A Choudhury, head of cards, Towfiqul Alam choudhury, head of NRB, Ziaul Karim, head of brand and marketing from EBL, and J A Nasser, operative director, Hamdur Rahman Simon, head of sales and marketing, from Navana Ltd.

The Independent/Bangladesh/ 6th April 2012

 The Securities and Exchange Commission allowed two more institutions to roll out full-fledged merchant banking operations in the stock market. On Wednesday, the SEC gave nod the two institutions -- IL Capital Limited and CAMP Advisory Ltd --to begin operations.

The new permits bring the number of merchant banks to 52. The responsibilities of a full-fledged merchant bank include underwriting, issue management, portfolio management and lending to stock investors.

The new merchant banks may boost liquidity flows into the market and ease entry of new exchange listings.In 2009, finance ministry asked the SEC to increase number merchant banks to 65. Official sources said, 20 more institutions are awaiting SEC approval for getting merchant banking licences.

The Independent/Bangladesh/ 6th April 2012

Towhid Samad, Chairman, Board of Trustees, Independent University of Bangladesh (IUB), inaugurates two ATM booths of the Bank at the IUB campus at Bashundhara residential area in the city on Thursday.

Mutual Trust Bank Limited (MTB) opened two new ATM booths at the Independent University of Bangladesh (IUB) campus at Bashundhara residential area in the city.

Towhid Samad, chairman of IUB Board of Trustees, formally inaugurated the booths as chief guest yesterday, says a press release.

Prof M Omar Rahman, vice chancellor of IUB, and Dr Arif Dowla, chairman of MTB, also attended the function as special guests.

The Daily Sun/Bangladesh/ 6th April 2012

A Jabbar Mollah, Vice Chairman of Social Islami Bank Limited, inaugurates an ATM booth at the Bank’s Khulna branch recently.

Social Islami Bank Limited opened an ATM booth at its Khulna branch recently.

A Jabbar Mollah, Vice Chairman of the Bank inaugurated the ATM booth as chief guest, said a press release.

Among others, Muha- mmed Ali, Managing Director of the Bank, AMM F Farhad and Md. Mohashin Miah, Deputy Managing Directors and Head of Khulna Branch Shaikh Magfar Uddin and local elites were present on the occasion.

The Daily Sun/Bangladesh/ 6th April 2012