Bangladesh's state-owned commercial banks (SCBs) have unilaterally raised the rate of commission charged for opening letters of credit (L/Cs) for oil imports by Bangladesh Petroleum Corporation (BPC) according to its chairman, Abubakar Siddique.

He says the banks' behaviour has raised import costs for the country's main oil importer, which is calling on the government to take steps to reduce the burden of L/C commissions.

Retrospective hike

Siddique says the SCBs raised the commission rate to 0.4 per cent from the previous rate of 0.25 per cent without any discussion with BPC.

He also alleges the SCBs raised the commission with retrospective effect from September 2011.

Call to government

The BPC chairman says the company has written to the finance ministry requesting it takes steps to reduce the L/C commission rate now being charged by the SCBs.

Siddique says that state-owned BPC wants the L/C commission to be cut back to 0.25 per cent.

Sluggish settlements

The chairman of the often cash strapped oil importer also called for more timely settlement of L/Cs by the SCBs.

He claims the banks, "very often linger" over L/C settlements.

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