Bangladesh Bank (BB) Governor Dr Ahsan H Mansur said at a press conference on Thursday six weak banks were given Tk 22,500 crore by printing money.
He said, "We will withdraw this money by issuing bonds. We will have a tight policy. We will give it by one hand, and take back by another. This will not create instability in the market."
He said, we are providing liquidity support to weak banks, to protect depositors. Tk 22,500 crore have already been given. However, we have come out of the instability that was in the branches. From Sunday, everyone (customers) will receive money according to their own needs in the branches.
Addressing the depositors, the governor said, the depositors' money is safe, you can rest assured. In whichever bank you keep your money, it will be safe, there will be no problem. Withdraw as much money as you need. There is no problem with depositors' money, that is our headache. Depositors' money will be safe. However, if everyone starts withdrawing money at a time, no bank will survive.
Regarding printing new money, he said, we have provided money to ensure the safety of depositors. Here, the flow of money will not increase in the market, nor will inflation increase. Because, we are giving money in one hand, and by issuing bonds, we are also withdrawing that money in the other hand.
Dr Ahsan H Mansur said, the monitoring policy will remain tight as before. We will not destabilise the market. You will go to the bank branches from Sunday, you will see that customers are able to withdraw money from all the branches. However, if all customers withdraw money at a time, there will be no money. I will also say that no one should withdraw Tk 100 crore at a time.
After the fall of the Sheikh Hasina government, the interim government appointed Ahsan H. Mansur, the 13th Governor of Bangladesh Bank on August 13. After taking charge, he announced that no more liquidity support will be provided to weak and troubled banks by printing money.
He announced that liquidity support will be provided to troubled banks through interbank transfers and the central bank will stand the guarantor. To provide full support to overcome the liquidity crisis, Tk 200000 crore will be required. This will increase inflation by many times.
