Customers of the 19 branches of 13 commercial banks in Bangladesh suspended from opening fresh letters of credit (L/Cs) against imports (DC World News, 11 April 2005) can open fresh L/Cs at other authorised branches of the banks, according to official sources at the central bank.

The move by the Bangladesh Bank (BB) aims to allow customers and banks to continue business relations until the suspensions are lifted the sources added.

Business continuity

Banks will be able to continue serving existing customers by processing fresh L/Cs at authorised branches that are not suspended from opening fresh L/Cs without prior permission of the central bank.

In this respect the BB appears to be tightening up on banks more than importers. "We don't take any decision that can hamper the country's business activities," a BB senior official told local media.

Investigations

The official also reported progress on the central bank's investigations into banking practices following the BB's order for the managing directors of the banks concerned to explain their positions on declaring information on import deals.

The central bank has now received at least six replies from the bank chiefs, and the BB is scrutinising those replies in line with existing rules and regulations.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.