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Monday, March 23, 2015, Chaitra 9, 1421 BS, Jamadius Sani 1, 1436 Hijr

BASIC Bank now a scheduled bank: BB
Published : Monday, 23 March, 2015,  Time : 12:00 AM,  View Count : 7

State-owned BASIC Bank will operate as a scheduled bank from now on rather than a specialised one, says Bangladesh Bank.
The decision was taken at a Board meeting of the central bank recently.
"The board members have been instructed to describe BASIC Bank as a commercial bank. And all the banks have been instructed accordingly," said Bangladesh Bank's Executive Director M Mahfuzur Rahman.
According to its Articles of Association, BASIC bank has to disburse 50 percent of its funds available for borrowing to small and medium enterprises.
The change means that it does not have to comply with that clause any more.
Scheduled banks, however, need a prior approval or a no-objection certificate (NOC) from the central bank to appoint directors, which is not the case for specialised banks.
But, the finance ministry recently appointed directors for the bank without consulting with the Bangladesh Bank.
The issue of BASIC Bank being a specialised or scheduled bank surfaced in that context.
The central bank had written to the finance ministry expressing its unhappiness over the matter.
It said that BASIC, which was formed under the Bank Company Act, is a commercial entity. So, an NOC from the Bangladesh Bank is a mandatory legal requirement.
After which, the ministry obtained an NOC by the central bank over the appointments.    ?

Editor : Iqbal Sobhan Chowdhury
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