FOREIGN BILLS AGAINST LCS: BB asks 21 banks to explain failure to settle bills in time

Posted by BankInfo on Tue, Apr 15 2014 11:30 am

Bangladesh Bank has issued show-cause notices to 21 scheduled banks to explain why they failed to settle their foreign bills in due time against letters of credit in line with the central bank’s directives.
A BB official told New Age on Thursday that the central bank had served the notices on the banks on April 7, asking them to reply to the notices by April 17, 2014.
The BB earlier issued a circular saying that it would impose financial penalty against the banks which would fail to make payments to foreign parties against LCs in time, he said.
The country’s business image is being tarnished due to the large overdue position in the foreign bill as it is reported globally when a bank fails to pay against an LC on maturity, the official said.
The BB had earlier asked the banks several times to settle their overdue foreign and local bill against LCs, but the banks neglected the central bank’s directives, he said.
The 21 banks which got the BB’s show-cause notices are: Al-Arafah Islami Bank, Agrani_Bank, Bank Asia, BASIC Bank, Bangladesh Krishi Bank, Dhaka Bank, Dutch-Bangla Bank, IFIC Bank Islami Bank Bangladesh, Janata Bank, Jamuna Bank, National Bank of Pakistan, National Bank, ONE Bank, Premier Bank, Prime Bank, Pubali Bank, Rupali Bank, shahjalal Bank, Sonali Bank and Standard Bank.
Due to the overdue acceptance bills in foreign LCs, the country is now bearing extra cost in LC confirmation charges.
The LC confirmation charge is imposed when an exporter’s (foreign party) bank wants security in receiving payments under the LC.
Accordingly, an importer’s (local party) bank approaches international banks such as HSBC, Standard Chartered or Citibank NA, to provide guarantee to the exporter’s bank about the payments.
And, these banks impose a charge, which is called LC or ad confirmation fee. This is also called a ‘risk fee’ taken by the confirming bank.
The LC confirmation charge depends on some factors, mainly the country risk and the reputation and strength of the issuing bank. It is also called commitment fee and it varies from bank to bank.
Presently, banks charge 1.5 per cent to 2 per cent of LC value as confirmation fee, meaning a local importer has to pay $2 million to another bank as LC confirmation fee against an import of $100 million worth of goods.
‘It should be 0.5 per cent of LC value, especially after Bangladesh coming out of the grey list of Financial Action Task Force’, the BB official said.
The international credit rating agencies like Standard and Poor’s, Moody’s is considering the banking performance about the capacity of settling the foreign bills when they conduct the sovereign rating for any country.
So, the country’s overdue position in foreign bill will put an adverse impact on its upcoming sovereign rating.

News:New Age/14-Apr-2014

Harmuz Mia promoted to GM of Agrani Bank

Posted by BankInfo on Tue, Apr 15 2014 10:52 am

Md. Harmuz Mia was recently promoted to General Manager of Agrani Bank Limited and joined office in Mymensingh circle.

Prior to new post, he served as DGM Ramna Corporate Branch in Dhaka. He also served in different corporate branches in Dhaka, circles, zones and divisions, said a press release.

After completing graduation with Honours and Master’s degree in Applied Physics and Electronics from the University of Dhaka, he achieved several degrees in banking like Banking Diploma, Business Administration, Personnel Management and Foreign Exchange Related Finance in International Trade.

He also participates in different training programmes, seminars and symposiums at home and abroad. He started his banking career in 1986 as senior officer.

News:Daily Sun/15-Apr-2014

Standard Bank holds board meeting

Posted by BankInfo on Tue, Apr 15 2014 10:42 am

Kazi Akram Uddin Ahmed, Chairman, Standard Bank Limited, presides over the 222nd board meeting of the bank at the bank’s head office in Dhaka on Saturday.


 Standard Bank Limited organized its 222nd board meeting at the bank’s head office on Saturday.

Chairman of the Board of Directors of the bank Kazi Akram Uddin Ahmed presided over the meeting, said a press release.

Managing Director Md. Nazmus Salehin, DMD and Group Company Secretary AFM Nizamul Islam Chowdhury and DMD Mamun-Ur-Rashid were also present.

News:Daily Sun/15-Apr-2014

Union Bank signs deal with Hotel The Cox Today

Posted by BankInfo on Tue, Apr 15 2014 10:13 am

Abdul Kader, Head of PRD, Union Bank Ltd, and Mohiuddin Khan Khokon, Director, Sales and Marketing, Hotel The Cox Today, exchange documents after signing an agreement at the bank’s head office recently.


 corporate agreement was singed between Union Bank Ltd and Hotel The Cox Today at the head office of the bank recently.

Abdul Kader, Head of PRD, Union Bank Ltd and Mohiuddin Khan Khokon, Director, Sales and Marketing of Hotel The Cox Today signed the agreement on behalf of their respective sides, said a press release.

S.A.M. Salimullah, SEVP, Abdul Hannan Khan, Company Secretary and Senior Assistant Manager, Sales and Marketing, Hotel The Cox Today, ASM Humayun Kabir Chowdhury and other officers of both the organizations were present on the occasion.

News:Daily Sun/15-Apr-2014

AB Bank celebrates 32nd founding anniversary

Posted by BankInfo on Tue, Apr 15 2014 10:02 am

M. Wahidul Haque, Chairman along with Directors of AB Bank Limited, cuts a cake to mark the 32nd founding anniversary of the bank at bank’s head office recently.


 AB Bank Limited observed its 32nd founding anniversary recently. All the 89 branches of the bank observed the day in a befitting manner, said a press release.

To mark the occasion the bank organised, a friendly cricket match at BKSP field at Savar. M. Wahidul Haque, Chairman of the bank accompanied by the Directors of the bank attended the programme.

Shamim Ahmed Chaudhury, President and Managing Director of the bank greeted all present on the occasion.

Chairman of the bank expressed his gratitude to all shareholders, clients, well wishers and regulators for their continued support and trust in AB Bank. He also thanked the bank’s employees for their dedicated services. AB Bank operates 89 online branches including an Islamic Banking branch and one branch in Mumbai, India, 11 SME centers, two independent subsidiaries AB Investment Limited and AB Securities Limited and a wholly owned Subsidiary (ABFIL) in Hong Kong.

News:Daily Sun/15-Apr-2014
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