Banks asked not to buy any vehicle in next one year

Banks asked not to buy any vehicle in next one year

The Bangladesh Bank today asked banks not to purchase any vehicle in the next one year as part of the government's efforts to cut import payments to tackle the ongoing forex volatility.

Banks have to reduce 50 per cent of their annual operating expenses allocated for purchasing computer, electronic equipment and furniture, and spending for entertainment and travelling.

The funds that would be freed up from the cut in expenses cannot be redirected to other sectors or spent, according to a Bangladesh Bank notice.

The central bank move came after the government took a number of initiatives to cut import payments.

The blistering import payments has declined the country's foreign currency reserves.

Between July and May of the last fiscal year, import payments went up by 39 per cent year-on-year to $75.4 billion, whereas the inflow of remittance fell 15 per cent year-on-year to $21.03 billion in the whole 2021-22 fiscal year.

Last week, the reserves stood at $39.67 billion, in contrast to $46.15 billion in December.