The finance minister announced the reduction in CRR rates
Finance Minister Abul Maal Abdul Muhith has announced to reduce the amount of cash deposited in the Bangladesh Bank (CRR) in response to the demands of the bank owners to increase the cash supply.
Currently, banks have to deposit 6% of the deposits in cash with the Bangladesh Bank. The rate will be 4.5 percent now.
After the meeting with the bank's entrepreneurs' association BAB in the city's Sonargaon Hotel on Sunday, the finance minister announced this. When this decision came into effect, 10 thousand crore rupees from the central bank will come to the market.
Earlier, in the speech of the Janata Bank's Annual General Meeting in the same hotel, the Finance Minister said, the loan interest of the bank will fall to single digit or one-digit within one month. The bank's owners promised him that. He hopes the owners will defend the promise.
However, after meeting the finance minister's attention, the organization's chairman Nazrul Islam Majumder said after meeting with the BAB, the reduction within one month is not realistic. It can be said that, sooner will be reduced. No one can even say when the governor of Bangladesh Bank will be reduced. However, it is sure to get a single digit. Private banks have already done this. They lent for a long time at 8 or 9 percent interest.
In order to protect the interest of the depositors, a portion of the deposits of banks are to be kept in the Bangladesh Bank as a statutory deposit (SLR). Currently there are provisions to keep the current section banks as 19 percent SLRs. Of these, 6 percent of the cash in Bangladesh bank is kept in cash. The remaining 13 percent of the government bills or bonds are to be bought. If a bank fails to execute the program, then SLR will provide protection to some of the depositors.
In addition to the Finance Minister, Bangladesh Bank Governor Fazle Kabir, Financial Institution Division Secretary Yunusur Rahman, Chairman of IFIC Bank Salman F Rahman, Chairman of Standard Bank Kazi Akram Uddin Ahmed, Islami Bank Chairman Arattu Khan, Chairman of Premier Bank Dr. HBM Iqbal, Bangladesh Bank Advisor SK Sur Chowdhury, Deputy Governor SM Moniruzzaman and various officials were also present.
After the meeting, Finance Minister Abul Maal Abdul Muhith told reporters that due to the demand of the entrepreneurs of the bank, already 50 percent of the public institution's deposits were given to private banks. They had some more demands. There is a great deal of discussion in the Governor's presence. The entrepreneurs had demanded that CRR be reduced to 3 percent. Decided to reduce 1 percent considering international standards, internal affairs This opportunity will be given till December next. However, it will be decided after reviewing the matter again in June.
Asked whether inflation would increase due to CRR reduction, the Finance Minister said there is no pressure on inflation. There was no such thing in the country that inflation could be high. It's impossible. Regarding owners' claims in making the Financial Information Act to stop negative reports in the media about the bank sector, he said, it will not happen now. It will be seen during the budget discussion in June.