Deal signed to release Tk 300cr next week

The central bank, stockmarket regulator and state-run investment bank yesterday signed a tripartite memorandum of understanding on a Tk 900 crore refinance scheme for the investors who had lost money to a price debacle in 2011.
The central bank will release the first instalment, Tk 300 crore, of the fund next week after receiving a requisition for the money from Investment Corporation of Bangladesh, as per the MoU.
Bangladesh Bank's Executive Director SM Moniruzzaman, Bangladesh Securities and Exchange Commission's Executive Director Saifur Rahman and ICB Managing Director Md Fayekuzzaman signed the deal at the BB headquarters.
The fund was created at the instruction of the prime minister to assist the affected investors, Fayekuzzaman told reporters after the signing ceremony.
The affected retail investors, who had an investment up to Tk 10 lakh during January 2009 to November 2011, will get credit from the fund, he added.
After getting the fund at a 5 percent interest rate from the central bank, the ICB will lend it to merchant banks and stockbrokers at 7 percent.
The merchant banks and the stockbrokers will then disburse the fund to the retail investors at a 9 percent interest rate, according to the scheme guideline.
The borrowers will have to repay the loans every three months and should give corporate guarantee against the loans to the ICB, which will later deposit the received amount to the refinance fund.
The regulator will have the authority to cancel licences of the merchant banks and stockbrokers if they fail to repay the loans on time, the guideline said.
An inspection committee led by the BSEC and with representatives from the central bank and the stockmarket regulator will monitor the scheme operation and submit a report to the finance ministry every quarter.
The government in March 2012 had announced a compensation package that included an interest waiver on margin loans for the investors.