Saturday, December 5, 2020 | ePaper

Loan from the reserve is an ominous sign for economy

  • Print
FOR the first time, the central bank has taken initiative to lend to the private sector at low-interest rates from foreign currency reserve. Though Rupali Bank initially agreed to act as an agent in this lending initiative, later the bank withdrew the offer. Experts have been wondered the initiative to lend from the reserve can override the credit inflow inside and outside the central bank. When due to the culture of non-performing loans, default loans are on the rise in general and if the number of reserves defaulted, the entire economy will be collapsed with breakdown of restoration valve. During this pandemic, if the lend from reserve implemented, subsequent loan defaulters would be multiplied.
Amid the ongoing financial anomalies, suppliers or buyers who are taking credit in foreign currency from abroad are also becoming defaulters, banks and non-bank financial institutions will also be defaulters. If the reserve loan is not repaid, the country's notoriety will be worse. Money has also been drain out from the stock market. Reserve is the last hope of a state. If the loan is not repaid for any reason, it will be ruined.
Neither the central bank nor commercial banks have experienced in this regard. Experts opined that before taking such an initiative, there was a need for a review detailed of the risks and possibilities by discussing it at the policy-making level. But, the matter was not well communicated even at the highest level of the central bank. Even the Board did not discuss or decide on this issue. Many have been surprised when such a proposal came from a commercial bank to the central bank without any discussion, policy or decision.
Loans from the reserve cannot be given directly to any customer as there is no direct transaction of the central bank with the customers. For this, the central bank will give loans to customers through banks or financial institutions. Now the situation is normal in the country. In such a situation, it is not reasonable to give a loan from the reserve. If the loan from the reserve is not repaid for any reason, the image of the country will severely be tarnished and the country will be in grave danger.

More News For this Category

Yet we thank the autopsy report for awakening the NHRC at last

A PROBE committee of the National Human Rights Commission (NHRC) termed the occurrence happened to a family to wait for two years to get an autopsy report is a

Long-awaited Rohingya relocation kicks off despite UN, EU and int`l bodies` opposition

As part of the long-awaited government move to relocate Rohingyas from congested refugee camps in Cox's Bazar to Bhasan Char, a total of 1,642 Rohingyas arrived safely at the

Safenet For Children

Safenet For Children

Wares Ali Khan :Internet based online platforms and free social media have brought a set of positive changes in the attitude, thinking process and daily activities of the common

1971 War Picture Surrounding Victory

1971 War Picture Surrounding Victory

Dr. Forqan Uddin Ahmed :In the month of October and November' 1971, the freedom fighters launched massive attack on Pak army which led to the final victory of our

Illegal capital outflow hinders adequate investment

As per the recent Bangladesh Finance Intelligence Unit (BFIU) and the Anti-Corruption Commission (ACC) reports, the corruption money from Bangladesh finds safe haven in top ten countries - Singapore, Canada,

Handwash basin installation project is mere waste of public money

THE state-owned Department of Public Health Engineering (DPHE) has undertaken a hand wash basin installation project without any feasibility study but with higher costs for the job as per a

Debt Relief Efforts Need To Go Further

Patricia Scotland :In the last few months, due to the devastating effect the coronavirus pandemic has had on the global economy, the fiscal clock has been ticking more rapidly than

Unsafe Road Action Imperative To Avert Death

Md. Shafiqul Islam :The death procession in road accident has made the nation extremely worried. It has now become a routine phenomenon in our day to day life. Every year

Digital corruption and analog mentality of city councillors hinder a2i initiatives

DESPITE having a clear guideline issued from the Local Government Division, entrepreneurs under the government's a2i programme are not getting proper support due to lack of coordination with ward councillors.

Bangladesh to be the worst victim of building dams on Brahmaputra by China, India

MEDIA report said China would build large-scale dams on the River Yarlung Zangbo, which flows as the Brahmaputra River through India and Jamuna River through Bangladesh. China plans to generate