Hearsay on liquidity shortage in Bangladesh's banking system is a hoax, now bankers also say and dismiss it as scaremongering by vested quarters.
The Association of Bankers, Bangladesh (ABB) ruled out as 'romours' the speculations about 'liquidity shortfall' in the banking system as there is "enough surplus liquidity" in banks.
Talking to the FE, ABB chairman Selim R. F. Hussain said Tuesday there is a "vested quarter" that spreads the negative news of local currency shortfall only to put the economy into trouble through creating panic among the people.
"It's completely false rumour--there is no ground for anybody to be scared about Bangladeshi banks being unable to meet their obligation, particularly local-currency obligation," said Mr Hussain, also Managing Director and Chief Executive Officer (CEO) of Brac Bank.
He said some of their colleagues engaged in its Dubai office recently informed them that some expatriate Bangladeshis, who used to send remittance after two to three months, skipped sending money back home riding on such rumours.
"This is not a good sign. We should not forget that there is no bank in the history of the economy is failed," he said.
For the banks which had faced problem in the last 10 years, he said, the government and Bangladesh Bank managed to chalk out a good solution. "So, the rumour has no ground. I think their intention is very negative and detrimental to our society and economy as a whole."
Talking about deposit growth, he said banks are making growth but the deposit rate is relatively muted and the average growth is around double- digit.
In sync with the central bank, the banker also reaffirms that there is surplus liquidity of over Tk 1.60 trillion. "There is no shortfall. As chairman of the ABB, I have no information that any bank faces such crisis, and I can tell you that there is no need to panic."
There is a perception problem now prevailing in some groups who wrongly think there is a local currency shortfall but the reality is a shortfall of dollars, not the local currency, he said.
About LCs, the ABB Chairman said the banks are opening LCs based on their capacities in the current context when the economy is under stress. "This is not the time to import non-essential goods. I think the BB has done a good job for the last few months in managing down the demand."
Terming the country as a resilient one, he said the economy will rebound strongly the way it overcame the Covid-19 pandemic. "It may take three, six or twelve months but it will surely bounce back."
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