Deposits of Bangladeshis Tk 4,423cr | The Daily Star
12:00 AM, July 01, 2016 / LAST MODIFIED: 02:41 AM, July 01, 2016

Swiss Banks

Deposits of Bangladeshis Tk 4,423cr

Bangladeshi citizens' deposits with Swiss banks rose to 8.85 percent year-on-year in 2015 to an astounding Tk 4,423 crore (550.85 million Swiss franc), shows Swiss central bank data.

The deposits went up despite an ongoing global clampdown on the famed secrecy wall of Switzerland's banking system.

The amount had stood at Tk 4,283 crore in 2014, 36.02 percent up from the previous year. It was Tk 3,149 crore in 2013 and Tk 1,991 crore in 2012, shows the data from the Swiss National Bank (SNB).

India nationals put 1.206 billion franc while Pakistanis 1.477 billion franc in the banks last year. Nepalese and Sri Lankan citizens deposited 314 and 77 million franc respectively.

The total amount of money kept in Swiss banks by all their foreign clients fell by nearly four percent to 1.41 trillion franc or $1.45 trillion, shows the SNB data.

Zahid Hussain, lead economist at the World Bank's Dhaka office, said although the deposit growth came down, the total amount was going up. “It proves that money laundering has not stopped,” he told The Daily Star.

He said many have deposits with various Swiss banks as they do not feel safe keeping their illegally earned money in the country.

“These people [depositors] don't get much return on their deposits. They put the money there because they don't have to face questions.”

Zahid said lack of proper investment atmosphere in the country also prompts many to keep their money in such banks.

“Legally earned money also goes out of the country through legal channels,” he said, adding that deposits and savings certificates are the two major investment tools.

Overall, the money held in Swiss banks by their foreign clients from across the world rose to 1.5 trillion Swiss franc in 2014 from 1.32 trillion franc in 2013.

Switzerland is not the only country that has received Bangladeshi funds, as names of Canada, Malaysia and the UAE are also on the list.

Experts blame chaotic politics and lack of security for the rise in flows of money to Swiss banks.

The government would have to rise over partisan politics and take punitive measures for stalling illegal flow of money. The law and order, and governance must also be improved, they said.

The funds, described by the SNB as “liabilities” of Swiss banks or “amounts due to” their clients, are the official figures disclosed by the Swiss authorities.

These numbers, however, don't shed light on the alleged black money held by Bangladeshis.

The SNB figures also don't include the money that Bangladeshis or others might have deposited with Swiss banks in the names of entities from various countries.

For several decades, Switzerland has provided wealthy families around the world a convenient and safe place to stash their money.

The country's political neutrality, stability and tradition of bank secrecy have kept their fortunes beyond the reach of national governments and the most determined tax collectors.

Offshore accounts are not illegal, but many people use them to hide cash from the tax authorities, say experts.

Switzerland is now facing growing pressure from many countries to share details of foreign clients of its banks.

Swiss banks have also come under global pressure as countries, including India, are stepping up efforts to crack down on the black money menace. A Europe-led clampdown has also been launched on tax evasion and corruption.

Meanwhile, Zahid said data from the Global Financial Integrity (GFI), a Washington-based research organisation, gives a comprehensive picture about money laundered out of a country.

Illegal capital flight from Bangladesh surged 33.78 percent year-on-year to $9.66 billion in 2013 through trade misinvoicing and other channels, according to the GFI.

The highest in a decade, the amount was more than six percent of the country's GDP and one-third of the export receipts in 2013. It is three times the size of average foreign aid Bangladesh received in recent times.

The organisation had ranked Bangladesh 26th in the list of the countries that lost most money to illicit money outflows.                

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