Dhaka, Bangladesh (BBN)– The central bank has injected funds amounting to nearly BDT 3.60 billion to three banks to help minimize their cash withdrawal pressure ahead of the Eid-ul-Azha.
The Bangladesh Bank (BB), the country’s central bank, provided the funds to the banks using its assured liquidity support facility (ALSF) to help manage their funds smoothly before the Eid, officials said.
Such liquidity facility may continue today (Monday), the last working day before the Eid vacation, the BB officials hinted.
Both primary dealer (PD) and non-PD banks are eligible for such short term liquidity support against their treasury bills and bonds, they added.
A few numbers of banks particularly private commercial ones are now facing sudden short-term liquidity mismatch mainly due to withdrawal of cash money ahead of the Eid.
The banks may seek such liquidity support from the central bank today (Monday) to meet their growing demand for the liquidity, according to the industry insiders.
They said the inter-bank call money rate has been showing an upward trend since August 12, mainly due to higher withdrawal of cash money from the banks ahead of the Eid.
The trend may continue until today, they added.
The weighted average rate (WAR) on call money rose to around 4.50 per cent on Sunday from 2.17 per cent on August 12, another BB official said.
Talking to the BBN, a senior treasury official of a leasing commercial bank said such short-term borrowings normally increase before the Eid to meet the growing demand for money from the banks.
“But it is unlikely to cross maximum 5.0 per cent ahead of the Eid,” he predicted.