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Merchant Bankers Association seeks re-financing scheme at minimum rate

banner-logo-644x320Bangladesh Merchant Bankers Association (BMBA) has sought re-financing scheme for merchant banks at minimum rate of interest along with the reduction of existing tax imposed on their income, officials said.

The proposals came Tuesday at a meeting attended by BMBA members ahead of annual budget which will be announced in next June.

The BMBA has also proposed to consider the provisioning amount of money as allowable expenditure.

The BMBA Vice President Akter H Sannamat said they have waived 50 per cent of interest on margin loans provided against portfolios of affected investors as per the announcement of capital market re-financing scheme.

“The merchant banks will have to pay taxes on 50 per cent interests if the government won’t consider the amount as allowable expenditure. That’s why we urge the government to consider the matter in next annual budget,” said Mr. Sannamat, also the managing director of Union Capital.

He said the BMBA has also proposed to consider the money, which has to be deposited for provisioning of margin loans, as allowable expenditure.

“Our another proposal is to lower the existing 37.5 per cent interest at around 22 per cent as the cost of doing business is increasing day by day,” Sannamat said.

According to Sannamat, the merchant bankers have also proposed to introduce a re-financing fund so that the merchant banks can take loans paying minimum interest.

A large amount of Tk 150 billion remained stuck-up as loans under different accounts in the merchant banks since the stock market crash in late 2010.

“The whopping amount of unrealised loan is a real threat to the merchant banks,??? a BMBA source said.

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Source: Financial Express

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