Leasing companies want liquidity support
The association will submit a report over the issue to the Bangladesh Bank in a week so that the central bank can take proper action
Bangladesh Bank Governor Fazle Kabir has assured non-bank financial institutions (NBFIs) of liquidity support.
The assurance came at a meeting with the leaders of Bangladesh Leasing and Finance Companies Association at the central bank head office yesterday, said Mominul Islam, chairman of BLFCA, also managing director of IPDC Finance.
"NBFIs want emergency liquidity support against their extra investments in treasury bonds or bill or excess cash reserve," Mominul said after the meeting.
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Among the 34 NBFIs, six are weaker, and merger or changes in boards can help them survive and restore depositors' trust, he said.
The association will submit a report over the issue to the Bangladesh Bank in a week so that the central bank can take proper action, Mominul said.
He identified 'absence of corporate governance' as the primary cause of failure of the six financial institutions, casting a negative impact on the entire sector.
On Monday, the association leaders met Finance Minister AHM Mustafa Kamal and sought a refinance scheme worth Tk10,000 crore through the central bank to help the NBFI sector survive.
Sources from the sector informed that a panic has spread among the depositors after the liquidation of People's Leasing and Financial Services in July last year.
Earlier this week, former central banker Khondker Ibrahim Khaled resigned from the post of the chairman of International Leasing and Financial Services as he saw no hope to salvage the scam-hit NBFI.
