Mahfuja Mukul: Withdrawal of money from the market by selling dollars, devaluation of money against the dollar and high inflation and the tendency of people to eat up their savings have led to a liquidity crisis in banks. Recently at least 40 banks are running on lending in liquidity crisis.
Among them, Islami Bank, Social Islami Bank, First Security Islami Bank, Global Islami Bank and Union Bank are unable to maintain Cash Demand Deposit (CRR) and Statutory Deposit (SLR). These five banks have also been fined. But the banks are not in a position to pay that fine. In order to improve the existing situation, Bangladesh Bank has set a deadline of 20 days for the five banks to adjust the cash balance.
In a press conference organized on contemporary issues yesterday, Bangladesh Bank Executive Director and Spokesperson Majbaul Haqsaid this information. He said that if the five Islamic banks do not adjust the deficit within 20 working days, the payment system department of Bangladesh Bank will take action according to the law on the issue of stopping transactions with other banks. If the current accounts of various banks are negative, support is provided from Bangladesh Bank, which is later reconciled. It is an ongoing process. Current account deficit is a structural problem of banks. However, credit quality, foreign transactions and other portfolios of these banks are good.
It is known that letters were given to five Islamic banks in this December. It says, ‘Adjustment of negative balance of current account is advised within 20 working days of receipt of letter. If you fail to coordinate within the stipulated time, you will be barred from the specified clearing platform as per the agreement you have entered into with the Bangladesh Bank’s Payment System Department on “reserving sufficient amount of money as determined for clearing settlement”.
In response to a question from journalists, Majbaul Haque said that central bank will take appropriate decision against the banks if they do not coordinate within 20 days. In addition to Islamic banks, there is a liquidity crisis in several banks, including the National Bank. Cash has decreased as dollars have been withdrawn from the market.
The spokesperson said, $689.8 million of IMF and $400 million of Asian Development Bank have been added to the reserves. The foreign currency reserve is $25.82 billion. And according to the international standard BPM-6, it is $20.41 billion.
An official of Bangladesh Bank said on condition of anonymity that 40 of the country’s 61 banks have a serious liquidity crisis. These banks are borrowing cash. Banks borrow from the central bank as repos and liquidity support. And under the pressure of high inflation, people are destroying their savings. Apart from this, in the current fiscal year, the liquidity crisis has become evident due to the withdrawal of cash from the market by selling dollars.
In this regard, the executive director of the Policy Research Institute (PRI) Ahsan H. Mansoor said, due to a few banks, the liquidity deficit has increased excessively. As a result, a crisis has arisen. Strict action by the central bank is needed to control it.
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