In one year, the profit of foreign banks decreased by Tk 500 crore

Both deposits and profits of foreign banks operating in Bangladesh have declined. In one year, the total deposits of these banks have decreased by Tk 111 crore and profit by Tk 500 crore or 17 and a half percent.

This information was found in a report titled 'Activities of Foreign Banks in Bangladesh: Trends and Operational Analysis' published by Bangladesh Bank today on Wednesday. The report has analyzed various issues including deposits, loans, investments, profits of foreign banks.

According to the report, in the first six months of this year i.e. at the end of June, the deposits in foreign banks decreased by 87 thousand 379 crores, which was 87 thousand 490 crores in the same period last year. That is, the total deposits of foreign banks decreased by Tk 111 crore in one year. Apart from this, the combined profit of foreign banks decreased to Tk 2,322 crore at the end of last June, which was Tk 2,816 crore at the same time last year. This means, the profit of foreign banks decreased by Tk 494 crore in one year. However, the report did not provide any explanation for the decline in profits and deposits.

According to the report, 9 foreign commercial banks are currently operating in the country through 67 branches and 6 sub-branches. The banks are The Hong Kong and Shanghai Banking Corporation (HSBC), Standard Chartered Bangladesh (SCB), Citibank NA, Commercial Bank of Ceylon, Uri Bank, State Bank of India, Habib Bank, National Bank of Pakistan and Bank Alfalah.

A large portion of foreign bank deposits are low-interest current and savings accounts. At the end of last June, 32 thousand 801 crores of deposits in foreign banks are in this type of account. The second highest number of deposits is as open in foreign currency. As such, there is 17 thousand 88 crore taka. Apart from this, there are 12 thousand 665 crores of term or fixed deposits. Usually the interest rate on fixed or term deposits in banks is higher. But such deposits are kept low in foreign banks.

Foreign banks have been quite restrained in lending despite high low-interest deposits. At the end of last June, the combined loan amount of these banks was 48 thousand 704 crores, which was 48 thousand 355 crores at the end of June last year. Accordingly, the loan given by foreign banks has increased by Tk 349 crore in one year. Most of the loans given by them went to the industrial sector. Last June, the amount of loans disbursed to this sector was Tk 25 thousand 403 crores. Foreign banks have the least amount of loans in the transport and construction sectors. At the end of last June, their disbursed loan amount in the transport sector was Tk 10 crore. During the same period, the amount of loans disbursed to the construction sector was Tk 428 crore.