Bangladesh Bank has instructed banks to keep a minimum LC margin (cash advance) for importing rice and wheat, in order to keep their market prices at a tolerable level.
Banking regulation and policy department of Bangladesh Bank issued a circular in this regard – with immediate effect – today and sent it to top executives of all banks.
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The circular instructed that banks should kept LC margin at the minimum level, depending on the bank-client relationship.
“Rice, wheat and crops prices are seeing an upward trend, owing to the disruption in the global supply chain caused by the Russia-Ukraine war. As a result, the transport cost of global commodities has gone up, affecting prices in the local market,” the central bank circular added.
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To keep the import and supply channel smooth for rice and wheat, Bangladesh Bank asked banks to keep a minimum LC margin.
The central bank also directed banks to take a minimum cash advance from importers while opening LCs for a number of essential commodities in order to keep their prices at a tolerable level during Ramadan.
The demand for edible oil, lentils, onion, spices and dates usually goes up during Ramadan. As a result, the prices of the items also increase.
Source: United News of Bangladesh