BB asks banks to submit list of deposits worth Tk 1cr or more

Bangladesh Bank on Wednesday asked the commercial banks to provide the central bank on
weekly basis the list of fixed deposits and deposit pension schemes worth Tk 1 crore or more.
The directive was issued as the BB found that the banks were giving higher interest rates than
the rates announced by them, sources in the central bank said. The central bank in a circular
issued to chief executive officers and managing directors of all commercial banks also directed
the banks not to change the interest rates on deposits and lending more than once in a month.
The circular said that a central bank circular issued on January 4, 2011 had asked the banks
strongly not to give or charge higher interests on deposits and credits than the rates announced
by the banks. But it has been noticed in recent times that many of the banks are giving higher
interest or profits on fixed deposits and deposit pension scheme, beyond the rates announced
by them, said the BB circular on Wednesday. In these circumstances, the circular gave a chart
to the banks where the banks would furnish details of fixed deposit and deposit pension
schemes, which are new or renewed and worth Tk 1 crore or more on weekly basis to the
banking regulation and policy department of the central bank. The banks will send the data of
a week by the third work day of next week and the data must have been signed by the MD or
CEO of the bank, it said. The circular also said that a central bank circular issued on April 19,
2009 had directed banks that they could set interest rates on deposit and lending more than
once in a month. But from now on the banks will not set interest rates more than once in a
month, it said. Officials said that the central bank took the decisions amid criticism by business
community over high interest rates offered and charged by the banks. They said many of the
banks were giving higher interests on deposits to collect funds because of ongoing liquidity
crisis. The central bank last month asked banks to set interest rates on lending in such a way so
that the spread between deposit rate and lending rate does not cross 5. The Association of
Bankers, Bangladesh, a platform of MDs and CEOs of commercial banks, recently decided that
the banks would not give more than 12.50 per cent interest on deposits and not charge more
15.50 per cent interest on industrial loans and loans for import of essential commodities. But
business leaders on Monday in a meeting with the central bank alleged that the banks were not
following the ABB set rates.
NA 1.3.2012




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P-Alo 9.3.2011