Home Bangladesh Govt’s deposits in bank decreasing
Bangladesh - 4 weeks ago

Govt’s deposits in bank decreasing

Mahfuz Emran: Due to the impact of economic recession, the government’s deposit status in banks has significantly decreased. From September of last year to March of this year, government deposits in banks have decreased by Tk 5,548.27 crores in these six months. At the same time, the government’s share of total deposits in banks is also decreasing. This has a negative impact on the deposit flow of banks. This is due to the decrease in government revenue and increase in expenditure due to economic recession. However, the overall deposits have decreased, but now they have started to increase. In this, private sector deposits are increasing.
It can be seen from the report of Bangladesh Bank, earlier every year the government deposits in the banks were increasing. Government deposits decreased in 2022 compared to 2021 due to economic slowdown. Deposits increased in 2023 as compared to 2022 but decreased again in March 2024.
Imports fell due to global recession and dollar crisis. As a result, revenue in the import sector has also decreased. Business and trade have decreased due to economic recession within the country as well. As a result, the revenue from this sector has also decreased. As a result, the revenue is not getting as compared to the target. On the other hand, due to the recession, the current expenditure of the government is increasing in various sectors. The government is in financial crisis. To deal with this crisis, the government began to spend money on bank deposits. On the other hand, due to decrease in revenue and foreign grants, the amount of money deposited in the government treasury decreases. As a result, the government’s bank deposits continue to decrease. Even if the government increases some deposits by borrowing, it is not sustainable.
Meanwhile, the government’s share of total deposits in the banking sector is decreasing along with the decrease in government deposits. The share of private sector is increasing.
Compared to September last year, public sector deposits in banks decreased by Tk 14.62 million in December. Compared to December of last year, deposits have decreased by Tk 553.36 crore in March this year. In the six months from September last year to March this year, government deposits in banks have decreased by Tk 554.83 crore.
It can be seen from the report that the government deposits in the bank in December 2020 were Tk 2 lakh 52 thousand crores. Which is 18.24 percent of total deposits. Deposits increased by 6.68 percent during that period. Total deposits increased by 3.39 percent. That is, public sector deposits increased more. According to the government, deposits rose due to record remittances and foreign grants.
In December 2021, government deposits in banks were Tk 2 lakh 67 crore. Which is 17.64 percent of the total deposits. Deposits increased by 3.45 percent that year. Total deposits increased by 1.45 percent. In 2020, the revenue of the government decreased due to the business and trade being affected due to the corona infection. Due to which the deposits also decreased.
In December 2022, government deposits in banks were Tk 2 lakh 62 thousand crores. Which was 16.53 percent of the total deposits. During that time, government deposits decreased but the total increased by 1.75 percent. Due to economic recession, government expenditure increased and revenue decreased. Due to this the flow of deposits decreased.
In December 2023, the government’s deposits were Tk 2 lakh 98 thousand crores. Which was 17.02 percent of the total deposits. Government deposits increased by 1.79 percent that year. Total deposits increased by 2.25 percent. Private sector deposits increased more than government deposits.
In March 2024, the government’s bank deposits decreased to Tk 2 lakh 92 thousand crores. Which was 16.57 percent of the total deposits. Deposits fell by 1.68 percent during that period. Total deposits increased by 75 percent. Compared to July-March of last year, the growth of deposits in the same period of the current financial year has been 15.27 percent. But government deposits have declined.
Meanwhile, the point of discussion is that every year there was a shortfall in revenue compared to the target. But on the contrary, the cost of the government has increased. As a result, government deposits in banks have decreased.

Check Also

President Joe Biden tests positive for COVID-19 while campaigning in Las Vegas, has ‘mild symptoms’

International Desk: President Joe Biden tested positive for COVID-19 while traveling Wedne…