The sale of the government savings certificates is likely to drop by 20% in the first quarter of the current fiscal year amid profit rates fall in all the saving instruments, fears National Saving Directorate (NSD).
“Though the sale of the government saving certificates crossed the targets over the last couple of years, its total sale is likely to be declined by 20% at the end of the first quarter of the current fiscal due to the slash in profit rates,” NSD Director General Begum Mahmuda Akter Mina expressed her apprehension while talking to the Dhaka Tribune.
The government has fixed the targets of net borrowing from the state-run savings instruments through Bangladesh Bank, scheduled banks and Post Office Directorate during 2015-16 fiscal year, according to NSD.
“The government now concentrates on getting loans from the commercial banks because of the lower interest rate compared to the national saving instruments,” she added.
In May, the government slashed the deposit rate on its savings instruments by up to two percentage points to reduce its borrowing as well as prop up banks’ deposit collection.
Depending on the types of savings instruments, the rate went down to 11%-12% from 12%-14% earlier.
On the other hand, the weighted average interest rate on deposits at banks was 7.04% in April, 2015, down from 8.11% in the same month a year ago, according to Bangladesh Bank.
During this year’s budget announcement, loans from the banking system was set at Tk38,523 crore while from national savings instruments Tk15,000crore.
An official of finance division disclosed that the National Saving Directorate had sent the target proposals of all the savings instrumentslast week and urged the Bangladesh Bank, Commercial Bank and Directorate of Postal Services to give assistance for achieving the NSD targets.
Meanwhile, NSD fixed the target for Bangladesh Bank and the commercial banks of Tk13,620 crore for current fiscal year against the last fiscal year’s target attainment of Tk28,732crore. But, the government’s outstanding loan amounted to over Tk1,0,5130crore.
The target of the family savings certificates has been fixed at Tk4,400 crore for the current fiscal year while a three-month long profit-based savings instrument at Tk3,800 crore, a five-year long profit-based Bangladesh savings instrument at Tk3650 crore, Pension Savings Certificates at Tk750 crore, Bangladesh Prize Bond at Tk60 crore, Wage-Earner Development Bond at Tk700 crore.
Besides, US Dollar Premium Bond has been fixed at Tk40 crore while the US Dollar Investment Bond at Tk210 crore.
The total target of the post office directorate has also been fixed at Tk17,065 crore for the current fiscal.
Post Office Directorate family savings certificates has been fixed at Tk6,600crore for the current fiscal year while three-month long profit-based savings instrument at Tk4,050 crore, a five-year-long profit-based Bangladesh savings instrument at Tk235 crore, Pension Savings Certificates at Tk510 crore, Post Office Savings Bank (General Account) at Tk1,150 crore, Post Office Saving Bank (long term account) at Tk4,440 crore and Post life Insurance and Annuity at Tk80 crore.
The target of the four savings instruments for regional office of Dhaka district is estimated to be Tk3,300crore, Chittagong Tk1,398 crore, Rajshahi Tk542 crore, and Khulna Tk575 crore.
The four savings instruments are-Bangladesh savings certificates, three-month-long profit-based savings instrument, pension saving certificates and family savings certificates.
