Mohammad Mufazzal
The Ministry of Finance (MoF) has empowered the Bangladesh Bank (BB) to release Tk 3.0 billion out of total Tk 9.0 billion as first installment of refinancing scheme announced for the affected small investors in the capital market.
The Accounts and Budgeting Department of the BB has been informed about the decision of releasing the fund by the Office of Comptroller and Auditor General (CAG) of the MoF.
"Being directed, the CAG has empowered the BB to release Tk 3.0 billion as first installment from the fund allocated to help recoup the losses of the affected small investors under the revised budget for the fiscal year 2013-14," said the MoF's letter sent to the BB.
Asked, the committee, which has framed the guidelines on the disbursement of the fund among the stakeholders, said that the latest development came from the CAG office as part of the process of releasing the fund from the government's account.
The government will disburse Tk 9.0 billion in three installments under the refinancing scheme earlier approved by Finance Minister AMA Muhith.
Meanwhile, the committee submitted its draft guidelines to the MoF on July 19 including the disbursement and recovery procedure of the loan along with fixing the rate of interests for three steps.
"After the approval of our draft guidelines, the Investment of Bangladesh (ICB) will be able to provide the fund among the merchant banks and brokerage firms as loan," a key committee member told the FE.
He said before the disbursement of the fund, a memorandum of understanding (MoU) will be signed among the BB, the Bangladesh Securities and Exchange Commission (BSEC) and the state-run Investment Corporation of Bangladesh.
When asked how much time it will take to disburse the fund from the refinancing scheme, the committee member said it's not a matter of depositing money into someone's bank account.
"It is a huge job in consideration of the fund size, framing and approval of guidelines and relevant complexity. However, we hope the fund will be disbursed as early as possible," the committee member added.
The committee, led by Arif Khan, Commissioner of the SEC, has suggested disbursement of the loan at an interest rate of 8.0 per cent to the investors affected during the stock market debacle that occurred in December (2010)-January (2011).
As per the draft guideline, the ICB will receive the fund from the government at an interest rate of 4.0 per cent.
The ICB will then provide the loans to the merchant banks and brokerage firms at an interest rate of 6.0 per cent, of which 2.0 per cent will be deducted by the ICB as its service charge.
Eventually, the merchant banks and brokerage firms will disburse the loans to the affected investors at a plain interest rate of 8.0 per cent in the form of fresh loans or readjustment of margin loans taken by the affected investors during the last stock market debacle.
The Ministry of Finance (MoF) has empowered the Bangladesh Bank (BB) to release Tk 3.0 billion out of total Tk 9.0 billion as first installment of refinancing scheme announced for the affected small investors in the capital market.
The Accounts and Budgeting Department of the BB has been informed about the decision of releasing the fund by the Office of Comptroller and Auditor General (CAG) of the MoF.
"Being directed, the CAG has empowered the BB to release Tk 3.0 billion as first installment from the fund allocated to help recoup the losses of the affected small investors under the revised budget for the fiscal year 2013-14," said the MoF's letter sent to the BB.
Asked, the committee, which has framed the guidelines on the disbursement of the fund among the stakeholders, said that the latest development came from the CAG office as part of the process of releasing the fund from the government's account.
The government will disburse Tk 9.0 billion in three installments under the refinancing scheme earlier approved by Finance Minister AMA Muhith.
Meanwhile, the committee submitted its draft guidelines to the MoF on July 19 including the disbursement and recovery procedure of the loan along with fixing the rate of interests for three steps.
"After the approval of our draft guidelines, the Investment of Bangladesh (ICB) will be able to provide the fund among the merchant banks and brokerage firms as loan," a key committee member told the FE.
He said before the disbursement of the fund, a memorandum of understanding (MoU) will be signed among the BB, the Bangladesh Securities and Exchange Commission (BSEC) and the state-run Investment Corporation of Bangladesh.
When asked how much time it will take to disburse the fund from the refinancing scheme, the committee member said it's not a matter of depositing money into someone's bank account.
"It is a huge job in consideration of the fund size, framing and approval of guidelines and relevant complexity. However, we hope the fund will be disbursed as early as possible," the committee member added.
The committee, led by Arif Khan, Commissioner of the SEC, has suggested disbursement of the loan at an interest rate of 8.0 per cent to the investors affected during the stock market debacle that occurred in December (2010)-January (2011).
As per the draft guideline, the ICB will receive the fund from the government at an interest rate of 4.0 per cent.
The ICB will then provide the loans to the merchant banks and brokerage firms at an interest rate of 6.0 per cent, of which 2.0 per cent will be deducted by the ICB as its service charge.
Eventually, the merchant banks and brokerage firms will disburse the loans to the affected investors at a plain interest rate of 8.0 per cent in the form of fresh loans or readjustment of margin loans taken by the affected investors during the last stock market debacle.
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