Dhaka, Bangladesh (BBN) - The interest rate spread of commercial banks increased slightly in June despite the central bank's persuasion to lower it, at least below 5.0 percent, officials said.
The weighted average spread between lending and deposit rates in the banking sector rose to 5.27 percent as on June 30, 2010 from 5.20 percent in March last, according to the central bank statistics.
The weighted average rates on lending stood at 11.23 per cent in June last, while the interest rates on deposit were paid at 5.96 per cent by the banks.
"The overall interest rate spread increased slightly during the period under review after the interest rates on deposits were slashed," a senior official of the Bangladesh Bank (BB) said, adding that the spread would decline during the July-September period of this year.
The weighted average rates on deposit came down to 5.96 per cent in June 2010 from 6.13 per cent in March last, the BB's data showed.
The spread being maintained by at least 23 commercial banks out of 47 is still between over 5.0 and 11 percent, while the average spread of the state-owned four commercial banks, private commercial banks, foreign commercial banks, specialized banks is 3.69 per cent, 5.48 percent, 9.33 percent and 2.26 percent respectively.
BBN/SI/AD-23Sept10-10:19 am (BST)