No immediate plan for sovereign bonds
JP Morgan, the biggest US bank, seeks to be an adviser for Bangladesh on its first sovereign bonds to raise funds from the international market.
High officials from JP Morgan met Finance Minister AMA Muhith at his secretariat office yesterday and made the offer.
“It is high time that bonds are issued, as money can be raised with an interest rate ranging between 4 and 5 percent,” Muhith told reporters, quoting JP Morgan representatives.
But Muhith told the JP Morgan team that the government has no plans to issue sovereign bonds this year; it may consider the matter next year.
Madhav Kalyan, managing director and chief executive of JP Morgan's branch in India, Michael Paulus, head of its Asia-Pacific public sector group, and Sazzad Anam, head of its Bangladesh office, met Muhith.
In August, Goldman Sachs made a similar offer saying Bangladesh could raise $2-$3 billion from the international market through sovereign bonds.
On whether Bangladesh will have to issue the bonds to raise funds to build infrastructure, Muhith said: “Our foreign currency reserves are much better. So, we are not thinking about it at the moment.”
The current foreign exchange reserves of around $22 billion in Bangladesh can feed seven months' of import bills, against a recommended safe limit of 4 months.
A panel on bonds formed last year by the government submitted its report in March this year, recommending the issuance of $500 million, to be used primarily to develop infrastructure.
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