Good morning. Here's what happened overnight and what you need to know today.
1.
Govt's Bank Borrowing Nearly Doubles: The government has nearly doubled its borrowing from commercial banks in the first three months of the current fiscal year compared to the equivalent period last year, primarily due to lower revenue collection. Bankers also attributed the increased government borrowing to high interest rates on treasury bills and bonds, which have become an attractive investment option for banks as the private sector's demand for new loans has reduced. (The Business Standard)
2.
UCB Auditing Activities of Previous Board, Management: United Commercial Bank (UCB) is currently running a forensic audit to look into the role played by the previous board of directors and management committee, its new chairman, Sharif Zahir, said in a press conference yesterday. A forensic audit is an examination of a firm's or individual's finances to derive evidence that can be used in a court of law or legal proceeding, according to investopedia.com. (The Daily Star)
3.
Two of Problem Banks Get BB Recovery Tips: Two of crisis-ridden commercial banks' new managements were given Tuesday regulatory directions to improve their financial health through intensifying cash-recovery drives to recoup their soaring non-performing loans (NPLs). The central bank's instructions came from the Bangladesh Bank Governor, Dr Ahsan H. Mansur, during parleys with the reconstituted boards of the two commercial banks, sources said. As part of the BB-launched salvation moves to revitalise those banks of the country which got into troubles for past wrongs, the BB governor directed the instructions in meeting with the recently reconstructed boards of First Security Islami Bank (FSIB) and Bangladesh Commerce Bank (BCB) at the BB headquarters. (The Financial Express)
4.
Six State-Owned Banks without MDs: Six major state-owned banks—Sonali, Janata, Agrani, Rupali, BASIC, and Bangladesh Development Bank (BDBL)—have been operating without managing directors (MDs) for nearly a month, creating a leadership vacuum in these key financial institutions. The Ministry of Finance sent a letter on September 19, officially cancelling the contracts of the MDs for these banks. In response, the chairmen of the banks have urged Finance Adviser Salehuddin Ahmed to expedite the appointment of new MDs. (The Business Post)
5.
Why the Stock Market is Facing a Liquidity Crisis: The Dhaka Stock Exchange (DSE) is experiencing a liquidity crunch due to decreased investor participation, even though most stocks are undervalued relative to their earnings per share. According to the DSE, daily turnover has fallen to around Tk300 crore, a trend that has persisted for several weeks. In August, turnover exceeded Tk2,000 crore, and the key index of the DSE gained around 500 points shortly after the interim government took office, as investors anticipated reforms to restore confidence in the capital market. (The Business Standard)
6.
Millers Bring Down Steel Production as Demand Falls: The country's steel production fell significantly in September compared to the previous year as the industry reeled from a damaging slump in demand and subsequent price reduction. Amid nationwide protests, curfews, a political changeover and ensuing uncertainty, the past three months have been brutal for the local steel sector, with top suppliers like Bangladesh Steel Re-Rolling Mills Ltd (BSRM) and Anwar Ispat warning of increasingly bleak conditions. (The Daily Star)
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