Dhaka, Bangladesh (BBN)-The central bank of Bangladesh on Tuesday provided overdraft (OD) facilities for US$10 million more to a state-owned commercial bank (SCB) for settlement of its food grains import bills and other payment obligations.
"We've provided the OD facilities to the SCB against the government approved securities to settle import payment bills for food grains and Hajj flight renting," a senior official of the Bangladesh Bank (BB), the country's central bank, told the FE on the day.
On October 8 last, the BB provided OD facilities of $68 million to another SCB for settlement of its fuel oil import bills.
The official also said the central bank will continue its foreign currency support to the commercial banks mainly for making payments of fuel oils, fertilizer and food grains.
The central bank of Bangladesh has continued its intervention in the inter-bank foreign exchange market by selling and buying US dollar directly and providing such short term facilities to the banks aiming to keep the market stable.
As part of the intervention, the central bank has bought $139 million from a foreign commercial bank recently to keep the country's inter-bank foreign exchange market stable.
On the other hand, the BB started intervention in the market by selling the US currency directly to the authorized dealers from October 29, 2007 to keep the market stable.
Since then, the central bank sold $735 million to the commercial banks as part of its intervention in the market, officials confirmed.
BBN/SI/SS/AD-14October08-6:32 PM (BST)