Bangladesh Bank Headquarters

Dhaka, Bangladesh (BBN)– The state-run banks have agreed to provide deposit to the private commercial banks (PCBs) at 6.0 per cent interest rate for implementing the single-digit lending rate, officials said.

The decision was disclosed at a meeting of the bankers, held at the Bangladesh Bank (BB) headquarters in Dhaka on Monday with BB Governor Fazle Kabir in the chair.

The government is also thinking about depositing its fund with both the public and the private sector banks at rates below 6.0 per cent to help implement the proposed interest rate, they added.

“We’re now discussing the issue with the government,” BB Deputy Governor Abu Hena Mohammad Razee Hassan told the reporters after the meeting.

He also said some banks have already implemented the proposed interest rate in line with the decisions of their board of directors. “Other banks are on the way (to do so).”

The latest moves came following the leaders of Association of Bankers, Bangladesh (ABB) urged the BB to intervene in the state-owned banks for depositing their funds with the PCBs at 6.0 per cent interest rate.

The ABB leaders also appealed the central bank at a meeting on June 25 to ensure depositing funds from the government agencies to their banks at rates below 6.0 per cent for implementing the single-digit lending rate.

Meanwhile, Obayed Ullah Al Masud, chief executive officer and managing director of the Sonali Bank Limited, said: “Yes, we’ll provide deposit to the PCBs at 6.0 per cent interest rate,” while talking to reporters after the meeting.

Meanwhile, the PCBs have started implementation of the proposed cut in their lending and deposit rates in line with the decisions of the Bangladesh Association of Banks (BAB).

On June 20, BAB decided to bring down the interest rates on lending and deposit to 9.0 per cent and 6.0 per cent respectively from July 01.

“We’ve already started implementation of the BAB-proposed interest rates,” Syed Mahbubur Rahman, chairman of the Association of Bankers, Bangladesh (ABB), told reporters.

He also said the PCBs are reducing the lending rates to 9.0 per cent from the existing level in line with the decisions of their respective board of directors.

“We’ve also sought supports from the central bank for smooth implementation of the proposed interest rates,” Mr. Rahman noted.