Former adviser to caretaker government Syed Manzur Elahi Saturday laid emphasis on proper credit risk management by banks, saying that the size of Bangladesh economy presently stands at US$ 100 billion which could have been double to 200 billion with better management of fund by the commercial banks. “The Credit Risk Management by the banks is significantly important as they are utilizing public money for proving credit for investment,” said Manzur Elahi, also the chairman of Apex Group, while speaking at the inaugural session of the ICC workshop here.
International Chamber of Commerce (ICC)-Bangladesh organised the workshop on Credit Risk Management.
The rate of Non-Performing Loans (NPL) of the state owned banks are the highest followed by Private Commercial Banks (PCBs) and Foreign Banks (FBs), he said, adding that as a result the liquidity gets affected which is ultimately hampering investment in development projects by the banks.
Manzur Elahi appreciated the Bangladesh Bank (BB) Manual of Credit Risk, which, he said, was very comprehensive and if properly followed by banks it would definitely help reduce credit risk.
“It will also help better management of fund. Bangladesh Bank should build up more professional capacity and increased manpower to monitor the risk,” he suggested.
He, however, has apprehension that it would be difficult for the BB to monitor liquidity closely as more banks are entering in the financial market in future.  Prof. Mamun Rashid, a noted money market critique, emphasized the need for appropriate tools and mechanism to mitigate the Credit Risk Management as it is not possible to eliminate credit risk totally.  He also urges to ensure proper management of Credit Risk as well as best utilization of resources.
Prof. Mamun thanked the HSBC Bank for their cooperation to organize the workshop. The workshop will provide participants with an overview of best practices in credit risk management and how to avoid unexpected losses, he said, adding that participants would also be able to benchmark their institution against industry best practices. Emphasis will be given on corporate credit risk management, he added.
Johnson Chang, Credit Risk Officer, HSBC Bangladesh, who is also the resource person of the workshop, spoke at the inaugural session. Among others, ICCB Secretary General Ataur Rahman also spoke in the workshop. A total of 68 senior and mid-level executives from banks and financial institutions attended the workshop. A similar workshop will be held in Chittagong on March 25.

The Independent/ Bangladesh/ 25-03-12

Bangladesh Bank (BB) is set to approve licence for new commercial banks in a meeting of its board of directors to be held on March 27.

A senior BB official said this but could not confirm how many banks will get approval from the board.

However, a member of the evaluation committee said seven commercial banks might get licence. “The board of directors is expected to approve seven banks, including two by Non-Resident Bangladeshis, in its meeting on March 27,” he added.

On September 27, 2011, the central bank invited applications from people interested in setting up new commercial banks. The BB asked the interested sponsors to submit their applications with a non-refundable bank draft of Tk 1000000 by November 30, 2011. The central bank’s scrutiny committee selected 16 applications out of a total 37 for the new banks.

Earlier, the central bank fixed the paid-up capital of Tk 2 billion for the new banks but it re-fixed the paid-up capital for a new bank at Tk 4 billion as per the revised Bank Companies Act. —BSS

The Daily Sun /Bangladesh/ 25th March 2012

The Chairman of Shahjalal Islami Bank Limited Alhaj Anwer Hossain Khan handed over a cheque worth Taka 1.0 million (10 lac) recently to Professor A A M S Arefin Siddique, Vice Chancellor of Dhaka University for supporting 46th Convocation of DU. Among others Controller of Examination of Dhaka University Baharul Haque Chowdhury and Head of PRD of the Bank Shamsuddoha Shimu were present on the occasion.

Financial Express/Bangladesh/ 22th March 2012

Chairman, Board of Directors of Pubali Bank Ltd Hafiz Ahmed Mazumder, MP, formally inaugurating the Pallabi branch of the Bank as the chief guest Wednesday. Director Sk Wahidur Rahman, Managing Director Helal Ahmed Chowdhury and Additional Managing Director M.A. Halim Chowdhury also seen.

Financial Express/Bangladesh/ 22th March 2012

Merchant banks will now have to pay 42.5 per cent in corporate tax instead of 37.5 per cent as the revenue board has decided to treat them as 'financial institutions', officials have said.

The officials of the National Board of Revenue (NBR) recently started issuing letters to different merchant banks instructing them to comply with its directive.

Among others, Benco Finance Investment has also got the letter from the NBR.

"We have been mistakenly treating those as private firms. But merchant banks fall under the category of financial institutions," a senior official at large tax payers unit (LTU) under the board's income tax wing told the FE Wednesday.

Former NBR chairman Muhammad Abdul Mazid said the central bank recently has come up with the definition of financial institutions (FIs) and as per the latest definition, merchant banks will be treated as 'financial institutions'.

"Lately, merchant banks are being upgraded due to their extended functions. That's why merchant banks will be treated as financial institutions," Mr. Mazid told the FE.

As private firms, merchant banks used to pay 37.5 per cent corporate tax under Section 82 of the income tax law.

"Both the NBR and the merchant banks did not look into the said Section of the income tax law, under which these banks will have to pay 42.5 per cent corporate tax," an NBR official told the FE.

He said the revenue board was contacting the merchant banks one after one to inform them that they would be treated as 'financial institutions' as per the law.

"We have given them a reminder that the law is being applied to them. They have also agreed to comply with the existing law in paying the corporate tax," the NBR official said.

Presently, a total of 50 merchant banks are running their business in the country's stock market.

When asked, different merchant banks have expressed their 'dissatisfaction' over the letter the NBR has sent to them.Merchant banks will now have to pay 42.5 per cent in corporate tax instead of 37.5 per cent as the revenue board has decided to treat them as 'financial institutions', officials have said.

The officials of the National Board of Revenue (NBR) recently started issuing letters to different merchant banks instructing them to comply with its directive.

Among others, Benco Finance Investment has also got the letter from the NBR.

"We have been mistakenly treating those as private firms. But merchant banks fall under the category of financial institutions," a senior official at large tax payers unit (LTU) under the board's income tax wing told the FE Wednesday.

Former NBR chairman Muhammad Abdul Mazid said the central bank recently has come up with the definition of financial institutions (FIs) and as per the latest definition, merchant banks will be treated as 'financial institutions'.

"Lately, merchant banks are being upgraded due to their extended functions. That's why merchant banks will be treated as financial institutions," Mr. Mazid told the FE.

As private firms, merchant banks used to pay 37.5 per cent corporate tax under Section 82 of the income tax law.

"Both the NBR and the merchant banks did not look into the said Section of the income tax law, under which these banks will have to pay 42.5 per cent corporate tax," an NBR official told the FE.

He said the revenue board was contacting the merchant banks one after one to inform them that they would be treated as 'financial institutions' as per the law.

"We have given them a reminder that the law is being applied to them. They have also agreed to comply with the existing law in paying the corporate tax," the NBR official said.

Presently, a total of 50 merchant banks are running their business in the country's stock market.

When asked, different merchant banks have expressed their 'dissatisfaction' over the letter the NBR has sent to them.

Financial Express/Bangladesh/ 22th March 2012