Business Report :
In a significant move to address the ongoing liquidity crisis in Bangladesh’s banking sector, five financially stable banks have extended loan support to their weaker counterparts.
The five banks – City Bank PLC, Mutual Trust Bank PLC (MTBL), Dutch-Bangla Bank PLC, Bengal Commercial Bank Ltd, and Eastern Bank PLC- have been approved to provide a total of Tk945 liquidity support to four weak banks – First Security Islami Bank, Social Islami Bank PLC, National Bank Ltd and Global Islami Bank PLC, according to central bank documents.
Of the banks, FSIBL has been approved to receive Tk300 crore, with Tk200 crore from City Bank, Tk50 crore from MTBL, and another Tk50 crore from Dutch-Bangla Bank Limited (DBBL).
National Bank has been given a total of Tk270 crore. Of the amount, City Bank will provide Tk200 crore, Bengal Commercial Bank will provide Tk20 crore and MTBL Tk50 crore.
Besides, Social Islami Bank Limited has been approved to receive a total of Tk350 crore. Of the amount, City Bank will provide Tk300 crore and MTBL Tk50 crore.
Lastly, Global Islami Bank has been approved to receive Tk25 crore from Eastern Bank.
The liquidity injection has been initiated to support these banks in overcoming the ongoing cash crunch. Some banks are still in the process of completing the necessary documentation before extending further support to other affected institutions.
The development comes as the weak banks are facing a severe liquidity crisis.