The Extended Credit Facility (ECF) mission of the International Monetary Fund (IMF) on Sunday started discussions with finance ministry and Bangladesh Bank (BB) officials on macro-economic fundamentals and future reforms for attaining firm footings in the financial sector. IMF Deputy Division Chief of Asia Pacific Department Cubero Rodigo arrived in Dhaka with a high-powered delegation and is expected to stay in the country until first week of next month.
The mission members held separate meetings with finance ministry and BB officials, basically highlighting the implementation progress of agreed areas of reforms, particularly on ailing state-owned banks, revenue board, budget deficit, subsidy and debt portfolio of the government, a finance official said.
‘The meeting will continue for about two weeks. The IMF is expected to highlight on flagging public banks, their capital shortfall and other major macro-economic
fundamentals,’ Abu Hena Mohd Razee Hassan, Deputy Governor, BB, told New Age on Sunday.
He said BB was busy preparing guidelines on Bank Resolution Framework and Lenders of the Last Resort as was agreed with the IMF earlier to prop up ailing state-owned banks, if necessary.
‘Fixing capital crunch and management failure of state-owned commercial banks along with cut in subsidy of BPC are two major concerns to be raised by the IMF mission during their stay in Dhaka,’ a senior official in the MoF told the New Age.
The ECF mission under its ‘third round review’ evaluated position of the government on issuing state guarantee against non-concessional loans under the ECF, he added, referring to the meeting held on Sunday.
The completion of the third review under ECF will enable disbursement of fourth installment for the country under the ECF arrangement for an amount of about US$136.6 million.
The government received about US$409.7 million as of June this year under the three-year ECF programme.
The Executive Board of the IMF approved a three-year ECF arrangement for Bangladesh on April 11, 2012 for a total amount equivalent to SDR 639.96 million (about US$956 million).
Meanwhile, according to the estimate of the World Bank, the combined capital shortfall in three SCBs—Sonali, Janata and Agrani—was about Tk 18,000 crore as of June this year.
-With New Age input
