Eastland Insurance Appoints Mohammed Salim as CEO

The Bangladesh Securities and Exchange Commission (BSEC) has taken steps to address underperformance at FAS Finance and Investment Limited by nominating five independent directors to its board. Four new directors include Maj Gen Md Anwarul Islam (Retd), Md Kamal Uddin Talukder, Selim Omrao Khan, and Md Mokhlesur Rahman, while Mohammed Nurul Amin has been reappointed as chairman. This move aims to revitalize the NBFI, which has faced challenges including liquidity issues, high non-performing loans, and inadequate shareholder compliance. FAS Finance, listed since 2008, continues to struggle with financial losses and a declining share price, closing at Tk3.40 recently.

In FY24, Bangladesh received $23.91 billion in remittances, marking a 10.66% increase from FY23. Islamic banks, including Islami Bank Bangladesh, Social Islami Bank, and Al-Arafah Islami Bank, contributed significantly with a total of $8.64 billion, representing 36.13% of the total remittances. Among these, Islami Bank Bangladesh led with $6.12 billion.

Non-bank financial institutions (NBFIs) in Bangladesh are still operating under the SMART-driven interest rate regime, despite the Bangladesh Bank's decision to abolish the SMART reference rate nearly two months ago. This decision, aimed at transitioning towards a market-based interest rate system, has been implemented by commercial banks following a directive from the monetary policy committee. However, NBFIs await similar official guidance from the central bank.

The "Payment and Settlement System Bill, 2024" was recently passed in parliament to regulate bank and non-bank payment services under a legal framework in Bangladesh. Finance Minister A H Mahmood Ali emphasized the need for the bill to protect customer interests, highlighting the absence of existing laws governing payment and settlement systems.

The Bangladesh Bank has lowered fees on credit guarantee facilities for Cottage, Micro, Small, and Medium Enterprises (CMSMEs) and financial inclusion sectors. In a recent circular, the central bank reduced the guarantee fee from 0.75% to 0.50% for the first year of the loan. Subsequent years will see a further reduction to 0.25%, aimed at enhancing affordability and accessibility of credit guarantees for entrepreneurs. This decision underscores the bank's commitment to supporting economic growth, reducing disparities, and promoting inclusive development, including women's empowerment in Bangladesh.

The Bangladesh Bank injected $12.79 billion into banks in FY2023-24 to address a severe US dollar crisis impacting import payments. This move also absorbed an equivalent amount of local currency, contributing to a local liquidity crisis, according to a senior central bank official. Over the past three fiscal years, the central bank has injected a total of $33.99 billion into the banking system, depleting forex reserves to $21.83 billion by June 30, 2024, down from $33.38 billion at the end of FY22. Despite import control measures introduced since April 2022, which reduced import payments by 12.59% year-on-year for July-March FY24, the central bank continues dollar support, primarily to state-run banks handling government import bills.