ZCZC
BSS-03
BB-CAPITAL-MARKET
Banks can form special fund to invest in stocks: BB
DHAKA, Feb 11, 2020 (BSS) – Bangladesh Bank (BB) has issued a circular
giving permission to all scheduled banks to form a special fund of Taka 200
crore each to invest in the capital market.
The fund can be drawn from the bank’s own resources or borrowing money from
the central bank through Treasury bill or Treasury bond repurchase agreements
or repos at a 5 percent interest rate, said a central bank press release
issued on Monday.
The scheduled banks can also make a combination of their own finances and
credit from the central bank through repos to set up the fund.
The provision will remain effective for five years until February, 2025,
the circular added.
The amount of special fund will be invested in equity shares, mutual funds,
bonds or debentures.
Under the mechanism, the banks may lend money to share market
intermediaries by charging maximum 7.0 per cent interest rate, according to
the circular.
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