Dhaka Bureau: Bangladesh Bank has received evidence of buying and selling 10 bank dollars at a higher price than the fixed rate. Action is being taken against them for disobeying the instructions. As part of this, Bangladesh Bank Spokesperson and Executive Director Mejbaul Haque told the media that a letter was sent to the banks on Tuesday asking them to know ‘why action will not be taken’. He said that after the investigation, Bangladesh Bank has started taking action against them according to the Bank Company Act.
However, he did not reveal the names of the banks. This list includes domestic, foreign, and state-owned banks. Earlier, in July last year, the central bank started further investigation after receiving allegations of manipulation of the dollar rate against 13 banks. Allegations against 10 of them have been proven. Bangladesh Bank Governor Abdur Rauf Talukder was ordered to take a strong stand to prevent the dollar rate from being kept high at that time. After that, several officials started the investigation.
On the same complaint, in August 2022, the central bank removed the head of the treasury department of six domestic and foreign banks for buying and selling dollars at an excessive rate. At that time, the names of BRAC Bank, City Bank, Prime Bank, Dutch-Bangla Bank, South East Bank, and Standard Chartered Bank were mentioned in the media. At that time, Bangladesh Bank sought an apology from the banks. However, due to legal restrictions, Bangladesh Bank allowed the re-instatement of treasury chiefs after one month without taking action against them. Banks were then directed to transfer half of the profits from the sale of dollars at a higher rate to the CSR fund.
It is also written not to raise the dollar rate without reason. On the advice of the International Monetary Fund (IMF), Bangladesh Bank is working to reduce the exchange rate of the main foreign currency dollar to a single rate instead of multiple rates. For this reason, the Foreign Exchange Dealers Association (BAFEDA) and the Association of Bank Executives (ABB) have been informing the banks of the dollar rate in consultation with Bangladesh Bank since September last year.
The member banks are informed of this rate every morning. Bangladesh Bank decided to buy at this rate. According to central bank policy, a limit (NOP-net open position) on how much foreign currency can be stored by a bank has been fixed. Earlier, banks were allowed to reserve up to 20 percent of their regulatory capital in foreign currency.
To reduce the volatility of the dollar market, the central bank reduced it to 15 percent on July 15, 2022. Banks have the obligation to sell dollars to the central bank or any other bank if they have more than this limit. However, in the investigation, the central bank officials found that when the dollar supply crisis started, many banks started making extra profits by holding excess currency and selling it at a higher price.
Even if there is an opportunity, the price is artificially increased without leaving it on the market. Some banks have also hidden information about saving dollars in the past. And these 10 banks have bought and sold dollars at a higher price than the rates set by BAFEDA and ABB.
