Apr 23, 2014, 10:13 am (BST)
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BB approves 3 NRB banks
DHAKA, April 4 (BSS) - Bangladesh Bank (BB) today approved the applications of three new banks, all of which are sponsored by non-resident Bangladeshis (NRBs).

The banks are NRB Commercial Bank Limited and two banks under the same name of NRB Bank Limited, one of which will get a separate name later.

NRB Commercial Bank is sponsored by expatiate Bangladeshi in the United States Iqbal Ahmed Chowdhury while Farasath Ali and Nizam Chowdhury, living in the United Kingdom are the sponsors of the two other banks.

The approval came in after hours of meeting of the central bank board that was scheduled for considering 16 other applications of new banks from local entrepreneurs. Governor Atiur Rahman chaired the meeting.

Among the proposed local banks are Madhumati Bank, The People's Bank', Union Bank, 'Meghna Bank, Katak-Bangla Bank, Federal Bank, People's Islami Bank, The Farmers' Bank Ltd, South Bangla Agriculture, Commerce Bank and Midland Bank Ltd.

The central bank will now take a decision on the local new banks at a meeting on Sunday, a BB official told journalists after briefing them on the outcome of today's (Wednesday) meeting.

"The NRB banks are given approval so that they can help expedite growth of remittance and foreign investment and develop bond market overseas," Deputy Governor SK Sur Chowdhury told reporters after the meeting.

Dismissing the claim of political pressure for allowing new banks, he said the banks were given permission for business after considering the merit of the sponsors and the benefit of them (the new banks).

He said the authority was cautious and would remain careful in allowing more banks in maintaining the proper criteria instead of considering any other reasons.

The central bank in November last year received 37 applications for new banks, of which five were from NRBs. A working group comprising BB officials examined the applications followed by further scrutiny by a technical committee that forwarded a list of 16 local and 3 NRBs banks to the board meeting for final decision.

According to the guideline for establishment of banks issued by the central bank in September last year, the bank would be a public limited company incorporated in Bangladesh, having a Taka 400 crore million paid-up capital.

An entrepreneur can hold a minimum of Taka 10 crore in shares or a maximum of 10 percent of the total shares. No share of the entrepreneur can be transferred in three years without the central bank's permission.

The bank will make an initial public offering within two years from the date of commencement of its operations to raise the remaining amount of its paid-up capital.

Loan defaulters are barred from seeking licence for new banks.

Other conditions included keeping no more than 13 members in
the board, providing the bank capital from the investors' properties as shown in the income tax statement.

At present 47 public, private and foreign banks are already in operation in the country.
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