Commercial banks with surplus funds are hesitant to invest in the collateral-free call money market, showing a preference for state-guaranteed instruments, which signals a trust deficit among bankers. Despite the Bangladesh Bank’s Standing Deposit Facility (SDF) offering a lower interest rate of 7.50% compared to the 9.0% call money rate, banks are opting for the SDF.
According to Bangladesh Bank statistics, while only one instance saw a bank use the SDF to inject Tk 4 billion, recent days have seen scheduled banks deposit an average of Tk 8 billion into the facility.
 A central bank official expressed surprise at this trend, as it contradicts usual market behavior. When questioned, a prominent banker and CEO revealed that banks are avoiding risk in the current environment, preferring safer investment options despite potentially lower returns.
Source for more details:
