Saiful Islam new DMD of Shahjalal Islami Bank
Prominent Banker M M Saiful Islam joined Shahjalal Islami Bank Limited as deputy managing director (DMD) on Monday. Prior to joining Shahjalal Islami Bank, he served Al-Arafah Islami Bank Limited as senior executive vice president and head of corporate investment, said a statement. Mr Islam obtai
Standard Bank, NCC Bank get nod to issue stock dividend
Standard Bank and NCC Bank have received consent from the Bangladesh Securities and Exchange Commission to declare stock dividends for the financial year that ended on December 31, 2022. In a filing on the Dhaka Stock Exchange on Wednesday, Standard Bank said it had received permission
Stocks open higher ahead of budget
The stock market opened higher on Wednesday, the last day of the month, as buoyant investors kept chasing lucrative shares in anticipation of quick gains just ahead of the national budget. Finance Minister AHM Mustafa Kamal is all set to unveil the national budget for the fiscal year (FY) 2023-24
Mercantile Bank aims to strengthen footprint by balancing risk & profit
Mercantile Bank Limited (MBL) plans to further strengthen its footprint in the banking industry through up-skilling
Economy
Government cuts borrowing target by 49%
May 30, 2023
· The scope for investment in saving certificates is set to be squeezed further as the government has cut the target of borrowing from the tools by 49% year-on-year to BDT 180bn (USD 1.7bn) for FY24, according to finance ministry officials.
· The target was BDT 350bn (USD 3.3bn) in the original budget for the ongoing FY23, which was later revised down to BDT 200bn (USD 1.9bn).
· The latest target is also the lowest in seven years. The previous lowest was BDT 196.1bn (USD 1.9bn) in FY17 when the total budget outlay was a little more than BDT 4,000bn (USD 37.7bn).
· Interest on savings tools was estimated at BDT 426.8bn (USD 4.0bn) in the original budget of the current fiscal year. It has been increased to BDT 451bn (USD 4.3bn) in the revised budget, according to the finance ministry.
Bangladesh’s credit rating declines to B1 from Ba3: Moody’s
May 30, 2023
· ‘Moody’s downgraded Bangladesh’s long-term issuer and senior unsecured ratings to B1 from Ba3 and affirmed short-term issuer ratings at Not Prime,’ it said in a statement on Tuesday. ‘The rating outlook is stable.’
· Moody’s assessment is that Bangladesh’s heightened external vulnerability and liquidity risks are persistent, and that, together with institutional weaknesses uncovered during the ongoing crisis, the sovereign’s credit profile is consistent with a B1 rating.
· Although there have been some improvements, the ongoing scarcity of dollars and the decline in foreign exchange reserves indicate sustained pressures on Bangladesh’s external position. These pressures further exacerbate constraints on imports and subsequently lead to energy shortages.
· Simultaneously, Moody’s has downgraded Bangladesh’s local currency and foreign-currency ceilings to Ba2 and B1 from Ba1 and Ba3 respectively.
From: https://www.newagebd.net/article/202977/bangladeshs-credit-rating-declines-to-b1-from-ba3-moodys
20% tax planned on interest on foreign loans
May 30, 2023
· Foreign loans will be costlier further as the government is likely to impose a 20% tax on the interest against loans from external sources, according to finance ministry officials.
· The upcoming budget plans to withdraw the existing facility of tax-free interest payment of foreign borrowings and make mandatory the deduction of tax at source (TDS) at 20% on the inter-company loan interest.
· Besides, the government plans to ensure compliance with double tax avoidance agreements (DTAA).
· On the other hand, the draft income tax law 2023 plans to impose a tax on other incomes, which will not be set off against core business losses.
From: https://www.tbsnews.net/economy/budget/20-tax-planned-interests-foreign-loans-641086
NBR sets 16% more revenue growth target for FY24
May 30, 2023
· The National Board of Revenue (NBR) is going to be tasked with earning 16% more in the next fiscal year to bankroll over a BDT 7,600bn (USD 71.7bn) annual budget in the backdrop of a dismal performance with revenue growth turning negative in April for the second time since the pandemic.
· According to the latest data from the NBR, revenue collection in April was 2.29% lower than a year-ago period in stark contrast with the usual phenomenon of higher earnings towards the end of the fiscal year. Revenue growth was only 4% in July 2021 which shot up to 22.8% in April last year.
· Yet, the finance ministry has set a revenue collection target of BDT 4,300bn (USD 40.6bn) in the next fiscal year to raise the tax-GDP ratio.
From: https://www.tbsnews.net/economy/revenue-growth-turns-negative-yet-lofty-target-set-fy24-641066
Government targets BDT 50b more non-tax revenue in FY24
May 30, 2023
· The government aims to realize BDT 500bn (USD 4.7bn) as non-tax revenue (NTR) in the next fiscal year, up by BDT 50bn (USD 0.5bn) from the current fiscal budget, according to officials.
· In the current budget, the target is set at BDT 450bn (USD 4.2bn), while it was later revised down to BDT 400bn (USD 3.8bn).
· This rise is supported by recent increases in various fees and charges by different government organizations, including various service providers.
Tax waivers counted in the subsidy account
May 30, 2023
· A sum of BDT 1.78 trillion (USD 16.8bn) has been projected as a direct tax expenditure in the 2023-24 national budget in the form of various tax exemptions now counted in the subsidy account in fiscal measures.
· The amount of tax expenditure would be considered a subsidy as incorporated into the total subsidy outlay of the government for the upcoming fiscal year along with other subsidies, officials said.
· In the current FY, the government has revised its allocation for subsidy upward to BDT 980bn (USD 9.2bn) from earlier BDT 814.9bn (USD 7.7bn).
· The government might propose a subsidy allocation worth BDT 1.10 trillion (USD 10.4bn) for FY 24, excluding the tax expenditure, in the BDT 7.61 trillion (USD 71.8bn) budget.
Textile millers for withdrawing addl security deposit on increased gas price
note: this post is for research and analysis purposes only.