The post SCBs lag behind in financing green projects appeared first on Dhaka Mirror.
]]>The SCBs disbursed only 2.39 per cent and the SDBs only 3.02 per cent of the total loan amounting to Tk 27,092 crore distributed by banks to the environment friendly projects in 2012, the BB report showed.
According to the BB guideline, the green finance includes both direct and indirect green finance. Banks’ direct green finance may be for renewable energy and environment friendly projects. Indirect green finance means financing the projects having effluent treatment plants or alike system.
A BB official told New Age on Thursday that the loans for installation of ETPs at industries, bio-gas plants, solar panels, bio-fertiliser plants and hybrid brick kilns were considered as green financing.
‘Many of the banks specially SCBs and SDBs think that financing the green projects will not bring any immediate benefits for the entrepreneurs and affect chance of repayment of loans. So, the banks go for more loans for projects which will generate quick profits,’ he said.
The BB data showed that the SCBs and the specialised banks disbursed Tk 650.72 crore and Tk 820.50 crore respectively in green financing in 2012.
The local commercial banks and the foreign commercial banks disbursed Tk 17,881.09 crore and Tk 7,739.83 crore respectively in the environment friendly projects in last year, the BB report showed.
Among the SCBs and the SDBs, only Rupali Bank and BASIC Bank secured position in the top 10 banks in terms of disbursing loans to the environment friendly projects in last year, another BB official said.
The BB data showed that top 10 banks contributed to a great extent having 90 per cent of the total green finance. Exim Bank topped them with more than 15 per cent. The other nine banks are Standard Chartered Bank, Rupali Bank, BASIC Bank, Islami Bank, Citibank NA, Bank Asia, Social Islami Bank, The City Bank and Eastern Bank.
Banks disbursed Tk 1,35.65 crore in loan for installation of ETP, Tk 25,910.00 crore to projects having ETPs, Tk 89.98 crore for bio-gas plants, Tk 3,63.83 crore for solar and renewable energy, and Tk 183.03 crore for hybrid hoffman kiln during 2012, the BB report showed.
The BB official said that the performance of SCBs and SDBs in giving green finance was dismal because of the banks’ greed for quick profits and mismanagement.
The BB report showed a very dismal performance of all banks in disbursing fund from Climate Risk Fund.
It showed that banks disbursed only Tk 25.88 crore under the scheme in 2012 against the target of Tk 214.53 crore.
-With New Age input
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]]>The post Banks in 4 metropolises to remain open Saturday appeared first on Dhaka Mirror.
]]>The branches in these metropolises will remain open so that people can deposit the security money for contesting in the elections of the four city corporations in the form of treasury challans, bank draft or pay order.
-With New Age input
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]]>The post Banking sector reeling from political unrest appeared first on Dhaka Mirror.
]]>They said that both collection of deposits and disbursement of loans had decreased alarmingly amid lower presence of clients in the bank due to the unrest.The bankers said that the default loan in the banking sector might increase further if the political unrest continued in the month to come.
Eastern Bank managing director and chief executive officer Ali Reza Iftekhar told New Age on Thursday that the importers had come under severe pressure as they failed to ship their products in due time because of hartal.
For this reason, the bank liabilities of the importers have already entered in a risky position, he said.
The overdue in loan repayment has recently increased significantly as the businesspeople are now facing a crisis due to the political unrest, he said.
Under the circumstances, the default loan in the banking will increase further in the coming months.
Iftekhar said, ‘The credit-deposit ratio in the banking industry went down massively in the last few months as the businessmen are reluctant to take loan because of the unfriendly business environment.’
According to Bangladesh Bank data till February 7, 2013, the banks’ loan-deposit ratio went down to 76.28 percent, well below the BB’s permitted level of 85 percent. It means the banks now lend Tk 76.28 against a deposit of Tk 100. Some banks’ loan disbursement has declined below Tk 70 against a Tk 100 deposit. The CDR of the EBL is 81.85 per cent.
The commercial banks are now investing in the government securities with a lower interest rate, Iftekhar said.
Pubali Bank MD and CEO Helal Ahmed Chowdhury said the frequent shutdowns had hit the transaction in the banking sector.
He said, ‘The loan repayments by the borrowers have already decreased in the banking sector due to hartal. Due to an unfriendly business environment, the entrepreneurs are not taking loan from the banks like previous scale. As a result, the loan disbursement decreased in the last few months.’
The National Bank additional managing Director Md Badiul Alam said that loan disbursement by the bank had already declined and it would decrease further in the coming days if the political turmoil persisted.
The private sector has come under serious pressure due to the hartal as the credit growth in the sector declined significantly, he said.
BB data showed that the credit growth in the private sector had slumped to 14.83 per cent in January compared to that of 17.79 per cent in the corresponding month of 2012.
Although the central bank took a slightly expansionary monetary policy for January-June of 2013 setting a credit growth target of 18.50 per cent for the period, the credit growth of 14.83 per cent in January was the lowest in last 19 months.
Alam said that the non-performing loans might also increase in the banking sector as the shutdown severely hit the businessmen.
The amount of classified or default loans in the banking sector increased by 88.67 per cent from Tk 22,644 crore in 2011 to Tk 42,723 crore in 2012, the BB data showed.
-With New Age input
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]]>The post Investors dejected by banks’ poor dividends appeared first on Dhaka Mirror.
]]>Investors at different brokerage houses said most of the banks, which hold the large portion of the capitalisation of the Dhaka Stock Exchange, had records of declarations of good dividends in the recent past.
They said that they had bought and held bank shares with a hope that the banks would continue to give good dividend for 2012 but most of them declared lower dividend than the previous years.
If the fundamentally good companies declare poor dividends, then there is no point of buying and holding good company shares, rather it influences retail investors to go for daily trading of junk shares, they said.The bankers, however, said the overall economic condition had not been business friendly last year which pushed down their profits and affected the dividends for shareholders.
Share prices of some banks declined heavily in the DSE in last few days after poor dividend declarations made by the banks.
‘Only our losses increased as we did not get the expected return and also the prices of bank shares are falling heavily after the poor dividend declarations,’ Shah Newaz, an investor who trades at Mercantile Bank Brokerage House, told New Age on Tuesday.
He said small-scale investors were suffering for the last two years for continuous depression of the market after the DSE general index crash-landed from its pick to 8918.51 points in December 5, 2010.
‘The poor corporate declarations by banks are affecting the entire market as it is the most influential sector of the market,’ said Muniruzzaman, an investor, who trades at Sonali Investment.
Faisal Ahmed, an investor who trades at the Dynamic Securities, alleged that some banks declared less dividends compared to their profit.
‘Bangladesh Bank and other regulatory authorities should investigate whether there was any motive behind the poor dividend declarations by the banks,’ he said.
Investors said they were apprehending that the banks which were yet to declare dividends would follow the same trend.
Of the 30 listed banks with the DSE, 14 declared dividends until Tuesday out of which 13 banks declared lower dividends than the previous year and one bank announced the same dividend as last year.
‘The loan provisioning of banks increased in recent times which pushed down their profit. As a result the dividends also declined,’ Association of Bankers’ vice-president Helal Ahmed Chowdhury told New Age on Tuesday.
Bank Asia, BRAC Bank, Dhaka Bank, Eastern Bank, Islami Bank Bangladesh, First Security Islami Bank, Mercantile Bank, Prime Bank, Pubali Bank, Southeast Bank, Standard Bank, Mutual Trust Bank and Trust Bank declared lower dividends for last year compared to the previous year.
Bank Asia declared 10 per cent stock dividend for 2012 which announced 20 per cent bonus for 2011 and 40 per cent cash dividend for 2010.
BRAC Bank declared 15 per cent stock dividend for 2012 which was 20 per cent stock for 2011, and 10 per cent cash and 20 per cent bonus for 2010.
Dhaka Bank offered 16 per cent stock dividend for its shareholders for 2012, which was 5 per cent cash and 30 per cent bonus for 2011, and 35 per cent bonus for 2010.
For the year 2012, Eastern Bank announced 20 per cent cash dividend while it was 35 per cent bonus for 2011 and 55 per cent bonus for 2010.
First Security Islami Bank declared 10 per cent stock dividend for 2012 while it was 10 per cent bonus for 2011 and 12 per cent bonus for 2010.
Mercantile Bank declared 7 per cent cash and 8 per cent stock dividend for 2012 while it was 23 per cent bonus for 2011 and 22 per cent bonus for the earlier one.
Prime Bank recommended 10 per cent cash and 10 per cent stock dividend for 2012 while declared 10 per cent cash and 20 per cent bonus for 2011, and 5 per cent cash and 35 per cent bonus in the earlier year.
Pubali Bank declared 10 per cent cash dividend for the year 2012 while it declared 5 per cent cash and 25 per cent bonus for 2011, and 5 per cent cash and 35 per cent bonus for the earlier year.
-With New Age input
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]]>The post BB, Probashi Kallyan Bank in disagreement appeared first on Dhaka Mirror.
]]>BB, Probashi Kallyan Bank in disagreement
Bangladesh Bank and the state-run Probashi Kallyan Bank have taken opposite stance on the latter’s proposal to allow it to go for commercial banking in limited scale.
The PKB, a bank set up for expatriates’ welfare, has made a proposal that the central bank should allow it to launch limited-scale commercial activities in one of its branch for the time being and open an exchange house.
The bank authorities raised the issue at a meeting at the finance ministry chaired by the banking division secretary M Aslam Alam on December 27.
But, Bangladesh Bank representatives at the meeting said that as per the banking company act there was no scope for a non-scheduled bank like PKB to go for commercial banking, said finance ministry officials.
PKB officials, however, said as per the Section 4(6) of the Probashi Kallyan Bank Act, 2010, the bank should be allowed to perform commercial banking.
The meeting decided that Bangladesh Bank would give specific opinions on allowing the PKB to go for commercial banking as per its need while the PKB would collect the info on rules and regulations on commercial banking from the BB and take necessary steps accordingly.
A senior BB official told New Age on Thursday that they had yet to send the opinions to the finance ministry, but as per the 31(1) section of the Bank Company Act, 1991, no bank is allowed to operate banking business without taking licence from the central bank.
‘If the PKB wants to go for banking business it should take licence by depositing necessary funds,’ he said.
When asked about the PKB proposal to allow it go for commercial banking, BB deputy governor SK Sur Chowdhury told New Age that the central bank had already cleared its position in last month’s meeting at the finance ministry.
He, however, would not say about the opinions the BB would send to the finance ministry.
PKB chairman Zafar Ahmed Khan, who is also the expatriate welfare secretary, told New Age that they expected that the BB would allow the PKB to operate commercial banking in limited scale taking into consideration of the act under which the bank is set up and the welfare of the expatriates.
He said that they had requested prime minister Sheikh Hasina to allow them to go for commercial banking as the bank was set up because of her political commitment and the PM sent the matter to the finance ministry.
‘But the central bank is dilly-dallying to provide approval for a commercial branch and opening of an exchange house of our bank.’
The PKB will be free from the existing liquidity crisis if it could operate the commercial banking, he said.
As per the minutes of the December 27 meeting at the finance ministry, PKB managing director CM Koyes Sami in the meeting said that the bank had been established to provide necessary facility to the expatriate workers so that they could send remittances more to the country.
He said that the PKB would be able to attain its desire success if it acquired an approval to open branch in a bid to operate commercial banking and to open exchange house abroad to earn foreign remittance.
BB representatives said the bank could go for agreement with foreign exchange houses like MoneyGram and Western Union to launch activities like distributing remittances.
PKB officials, however, said the expatriates would be deprived of fair rate of foreign exchanges if they had to link with foreign exchange houses.
Courtesy of New Age
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