Weak banks are using various ways to restore clients' confidence. They have reopened ATM booths and online transactions that were closed earlier. Meanwhile, more money is being given out to clients now as deposits pickup.
Some banks are also calling customers to give them money to give a positive message. Weak banks are trying to restore clients' trust this way and banks have started to benefit. However, it will take some time for the situation to make a turnaround, bankers said.
The situation tremendously changed following Bangladesh Bank is supply of 22,500 crore to weak banks to strengthen their operation. In the meantime, Tk 5,500 crore has been given to First Security Islami Bank; Tk 5000 crore to Exim Bank, Tk 4000 crore to Social Islami Bank, and Tk 4000 crore to National Bank. Union and Global Islami Bank will receive Tk 2000 crore each on Monday.
These banks are getting money at 10 percent interest bu in the form of bonds so that money supply in the market does not beef up to bolster inflation.
Except Exim Bank, the remaining 9 banks were under the control of S Alam Group. The central bank has dissolved the boards of 11 banks in the meantime, including the crisis laden banks. Huge money were taken from these banks in the name of fake loans.
Abdul Awal Mintu, chairman of the restructured board of directors of the National Bank, said the previous governor of Bangladesh Bank had misused the entire banking sector created distrust and irregularities. The designation of red and yellow lists for banks panicked clients.
Bangladesh Bank is now providing liquidity support and bankers hoped the situation will be normal within 2-4 weeks. He said even the best banks in the world would not allow depositors to withdraw of all their deposits at a time.
Panic stricken depositors initially thought these banks would no longer be able to repay their deposits and made rush to withdraw cash. They even redeeming their FDRs before maturity but now efforts are being made to convince depositors.
Bangladesh Bank Governor gave a strong message that said the central bank stands guarantee to all depositors money.
First Security Islami Bank Chairman Mohammad Abdul Mannan said all types of transactions have been activated in the last few days. All types of services including ATM booths, BEFTN, RTGS have been launched. All types of bills are being collected.
There is no longer a situation of panic. He said a specific limit has been set for transactions. Soon there will be no more limits.
Social Islami Bank Deputy Managing Director Nazmus Saadat said all types of services including online banking have been restored. Besides liquidity support from the central bank, emphasis has been placed on collecting new deposits.
Their main goal now is to restore customers' confidence. The positive thing is that the amount of money withdrawn from their principal branch on Sunday is less than the amount deposited showing return of normalcy.
Although Bangladesh Bank transferred money to the accounts of four banks last week, Union and Global Islami Bank have not yet received the money.
The fact is that the interim government had taken responsibility and announced that it would not print money anymore and give it to banks through DP notes. Now they can take the money from the central bank. If necessary, they can transfer it to another account.
If Bangladesh Bank gives money directly, it has an impact on inflation. However, to avoid a widespread impact, Bangladesh Bank is simultaneously withdrawing surplus money from the market through bills.
