Bangladesh Bank has extended the duration of the special fund for banks in the stock market by another 22 months, now until December 31, 2026. This decision will allow banks to make investments and coordinate existing investments until that date.
On Tuesday, Bangladesh Bank issued a circular announcing the extension of the special fund’s duration. The decision was made to help improve the stock market situation and ensure the overall stability of the financial sector.
In February 2020, Bangladesh Bank had allowed each bank to set up a special fund of 200 crore Taka for stock market investment, which was set to expire in February 2025. Before the expiry, the Bangladesh Securities and Exchange Commission (BSEC) had sent a letter to the Ministry of Finance’s Financial Institutions Division, requesting an extension of the fund’s duration. Based on the recommendations from various stakeholders, including the Financial Institutions Division, Bangladesh Bank has now extended the fund’s duration.
Liberty News’ economic correspondent states that the circular specifies that scheduled banks are required to form a 200 crore Taka special fund for stock market investments and must follow the related guidelines for these investments. Initially, the fund was set to last until February 2025. However, considering the current volatility in the stock market, the opinions of relevant stakeholders, and the overall goal to stabilize the financial sector, Bangladesh Bank has decided to extend the special fund’s duration until December 31, 2026.
LND/BG
