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Who are the robbers of the bank?

Trade Minister Tipu Munshi calls the banks ‘robbers’. He said at a program on Thursday, “There is no gap between the interest rates of bank loans and deposits anywhere in the world, not more than 2-3%. The rate is only 5 percent in Bangladesh. It’s a robbery. ‘

The Commerce Minister was the President of the BGMEA’s organization of garment sector owners. He also knows about the problems of investing in high interest rates. In his speech, he also told the banks that the Prime Minister’s directive to bring the rate of interest down to 1 figure.

Not only the commerce minister, why interest is not decreasing – this question is all about. But after the statement of the trade minister, a little terrorism can be done with the bank robbers. The answer to the question of who is the real ‘robber’ of the bank is to find out.

A year ago, on 20 June 2018, the Association of Banks’ Association (BAB), the organization of bank owners, announced that, on July 1, the interest on deposits and loans would be 6 percent and 9 percent respectively. The next day, governmental banks announced the decision to follow this decision by advertising at once. At the same time, many people mocking ‘fixing interest rates’ said ‘nine-six’. The fact that the joke was not wrong was the fact that the minister of finance has said.

How the bank will run, it has some international customs. Bangladesh Bank as the central bank follows. The Bangladesh Bank has the jurisdiction to make any policy decision regarding the bank. But taking away the ability to make a policy decision that is important to fix interest rates can be called ‘robbery’.

There was one reason why bank owners’ interest was not ‘six-six’. The Finance Minister reduced the corporate tax of the bank in the fiscal year 2018-19 to 2.5 percent. Earlier, the central bank allowed the reduction of cash deposits (CRR) by 1 percent and remained the bank director for 9 years and a family of 4 members to the board of the bank. The limit of government deposits has been increased from 25 percent to 50 percent. In exchange for so many benefits, the bank owners promised to reduce interest rates. But without any commitment, bank owners are enjoying all the facilities.

Without the analysis of the reason for the rise in interest rate, it can never be reduced by simply giving instructions. And there are many reasons for rising interest rates. There is currently liquidity crisis in the banking sector. Some banks collect deposits of more than 10 percent interest. There are also banks whose interest rates vary from 8 percent to 8 percent. To reduce interest rates, solve this liquidity crisis. Besides, now the rate of interest determines the market, the basis of the demand-supply basis. However, it is possible to reduce the rate of interest. For example, if banks were able to reduce their debt, banks could reduce interest rates by 1 to 2 percent.

In this case, it is possible to talk about the robbers discussed in the bank sector. FBCCI President Md. Shafiul Islam Mohiuddin said at a press conference on June 9 last year, “There is a group of people, who deliberately set the bank’s money, robbed the bank’s money. We want to give them exemplary punishment. ‘

So, to reduce the defaulting loan, you have to take a tough position against loan defaulters. But the government is giving more facilities to the loan defaulters. For example, if the rate of interest on the loan is 12 percent, then the entrepreneurs will have to pay back 13 percent or more. And if the default is 9 percent, it’s too long. The minister said this facility will be effective from May next month. If this is the case, then who will be able to return the loan to the bank?

Now the Commerce Minister, who is the real ‘robber’ of the bank?