Fourth instalment of $1b IMF loan likely in Nov

The government has fulfilled most of the IMF conditions to get the fourth instalment of a $1 billion loan from the lender by November.
This is the last instalment of the three-year loan, under an Extended Credit Facility, in the current tenure of the present government. The first instalment was disbursed in April 2012.
A team of the International Monetary Fund has started reviewing the implementation status of the conditions from last Sunday.
The team has already held meetings with the officials of Bangladesh Bank and the finance and other related ministries.
Officials of the finance ministry and the central bank said they expect to receive the fourth instalment -- $140 million -- by December.
The major conditions for releasing the fourth instalment of the loan were related to banking reforms, including those in the state-owned banks.
After a number of banking scams in 2012, the IMF wanted the government to conduct a special diagnostic examination of four state banks, focusing on their asset quality, liquidity management, and internal audit and controls.
A BB official said the examinations have already been carried out, and the banks were asked to address the key shortcomings.
In line with another IMF condition, the central bank has framed a policy on how it will rescue a bank if it becomes bankrupt or faces a serious liquidity crisis.
The policy was placed in the BB board meeting on Wednesday and will be approved in the next meeting, the central bank official said.
The IMF had also asked for limiting the banks' exposure to the stockmarket by amending the Banking Companies Act, which the government has carried out.

Another major condition of the lender was to contain the government's hard-term borrowing within the $3.2-billion ceiling by June 30 this year.
A finance ministry official said the amount is well within the limit and was $2.86 billion on June 30.
However, the new ceiling for hard-term borrowing for next June could be $4.5 billion, as the finance minister has called upon the lender to increase the non-concessional debt ceiling to accommodate loan guarantees for power projects.
To minimise subsidies and wastages in some state enterprises, the government has completed 'efficiency audits' into Bangladesh Petroleum Corporation, Power Development Board, and Bangladesh Chemical Industries Corporation, in line with another IMF condition.