Central bank rejects request to reduce interest rate on deposits Interest Rate on Deposits
ASaber91/Wikipedia Bangladesh Bank Building in Motijheel commercial area, Dhaka

Central bank rejects request to reduce interest rate on deposits

Bangladesh Live News | @banglalivenews | 12 Aug 2021, 12:18 pm

Dhaka, August 12: The central bank has rejected a request by the managing directors (MDs) of scheduled banks to reduce the minimum interest rates on deposits. Bangladesh Bank announced the decision at a bankers 'meeting with the banks' MDs on Wednesday (August 11). The meeting was held six and a half months later due to the Corona pandemic.

MDs joined the event through a video conference chaired by Bangladesh Bank Governor Fazle Kabir. The meeting discussed various issues including the progress of implementation of 9 per cent interest rate on loans, withdrawal or refinement of instructions not to pay less interest on term deposits, lifting of interest rate limits on both loans and deposits.

The managing director of a state-owned bank who attended the meeting said Bangladesh Bank officials argued at the meeting that the interest rate would not be reduced if the MDs of some banks requested it. Besides, the governor of Bangladesh Bank wanted to know about giving loans to banks to buy mobile-laptops. Although this sector has been seen as unproductive sector for so long, from now on it will be seen as productive sector, said the Governor. Besides, the central bank has decided to give certificates to 15 banks for implementing 100% of the loans in the incentive package.

In this regard, the Executive Director of Bangladesh Bank Spokesperson Sirajul Islam said that despite the request of the managing directors of various banks to reduce the interest on deposits, Bangladesh Bank presented arguments to maintain the interest on deposits. In this, Bangladesh Bank upheld the recent instructions.

The meeting discussed the Special Social Responsibility (CSR) of banks in terms of corona. The meeting also discussed the target of disbursing Tk 33,000 crore in the big industry and Tk 20,000 crore in the CMSME sector in the second year under the incentive.

At the same time, Tk 15,387 crore has been disbursed in the CMSME sector in the first year, which is 76.93 percent of the total target. In this case, testimonials will be given to 16 banks and five financial institutions which have achieved 100 percent target. The central bank has decided to issue show cause notices to banks that have disbursed less than 40 per cent.