Bankers praise monetary policy

Leading bankers hailed the monetary policy announced yesterday for the first half of the current fiscal year, saying the suggested changes would increase credit flow to the private sector.
“We are encouraged by the policy and hope that together, we will be able to post better growth and improvements in the future,” said Anis A Khan, managing director of Mutual Trust Bank.
Bangladesh Bank (BB) has revised the private sector credit growth target higher at 18.3 percent for July-December, the first half of the current fiscal year.
The target was 16 percent in the immediate past monetary policy statement (January-June).
The central bank led by Governor Atiur Rahman extended a fight against soaring consumer prices. Average inflation rose to 10.62 percent last fiscal year from 8.80 percent a year ago.
Tightening the credit belt for the banks and lending more to the government created a sort of liquidity crunch in the market in fiscal 2011-12.
“This (18 percent) will help the private sector get more credit,” said Khan, congratulating BB for announcing such a proactive and mature policy.
Helal Ahmed Chowdhury, managing director of Pubali Bank, praised the new monetary policy as prudent and hoped it would make more credit available to the private sector.
“We are encouraged to see the private sector credit target revised at over 18 percent that will help achieve the targeted economic growth,” Chowdhury said.
Nurul Amin, managing director of NCC Bank and chairman of the Association of Bankers' Bangladesh (ABB), also welcomed the new monetary policy.
“Setting the private sector credit growth target at 18.3 percent is a good move,” Amin said.
He, however, sees no major changes in the new policy with that of the previous one that envisaged inflation control and financial inclusion as its major tasks.
The ABB chairman is also concerned with government credit from the banking sector and the sufferings of the primary dealer (PD) banks. PD banks must buy government bonds and securities.
On money supply, Amin said it would go up in the next couple of months with an ease in credit supply and rise in export and remittances.
Dr Salehuddin Ahmed, former governor of the central bank, wanted to see more credit flow to the private sector given the present tight liquidity situation.
“The private sector credit target could have been set at 20 percent,” Ahmed said.