Investment banks seek concessional loans to stay afloat
Bangladesh Merchant Bankers’ Association, in a letter to the finance ministry last week, wrote for loans to its member companies and stock brokers at 4 percent interest rate
The ongoing shutdown has put enormous financial pressure on the country's investment banks as well, which had already been in a tight situation because of market adversity.
To pay rents, salaries and bills, they want to be included into the government-announced stimulus packages of concessional loans.
Bangladesh Merchant Bankers' Association (BMBA), in a letter to the Ministry of Finance last week, wrote for loans to its member companies and stock brokers at 4 percent interest rate.
Keep updated, follow The Business Standard's Google news channel
The BMBA proposed the amount of loans to market intermediary entities to be equivalent to their respective operating expenses of six months. The expenses can be determined based on the last year's audited accounts.
They expressed their preparedness to repay the loans through 24 monthly installments if begins from January 2021.
The letter, undersigned by BMBA President Md Sayadur Rahman and Secretary General Md Riyad Matin, also sought a facility to avert the pressure of paying installments of existing loans until December this year.
"We believe the merchant banks and brokers will be able to repay the amounts properly in the proposed course and that will help them survive the crisis period," said the association of the country's investment banks.
Otherwise, many entities may need to shut their operations, and there may emerge a situation of job losses in coming days, the BMBA fears.
