Bangladesh Bnak Governor refutes 'liquidity crisis' in banks

Bangladesh Bank Governor Dr Salehuddin Ahmed yesterday refuted the allegation that banks are faced with liquidity crisis. “Latest figures show that both deposits and credits in the banks increased as compared to that of the previous year's,” he told the reporters.The Governor said credit in the private sector grew 23.11 percent during July-April period of the current fiscal compared to that of the same period of previous fiscal.Country's leading businessmen, including the President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) alleged Saturday that the private sector is faced with credit crunch as the banks are running short of cash.Finance Adviser Dr AB Mirza Azizul Islam, however, dismissed the allegation quoting the central bank's information that the banking system had an excess liquidity of Tk 12,000 crore a couple of months ago.Salehuddin Ahmed apprehended that few banks might have problems of asset-liability mismatch as they lend more than their capability.“Surely, we'll look at how we can ensure adequate funds for the private sector,” he said, adding that the BB would examine and address the issue in the half-yearly monetary policy to be released early July. The Governor said he had a look at the recent figure concerning currency in circulation and found that currency circulation, as a proportion of bank deposits, has increased, instead of declining.The Governor said he expects issuing of notes of Tk 1,000 denomination by October this year.