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Dhaka Tribune

Palli Sanchay Bank proposal goes to cabinet today

Update : 10 Nov 2013, 06:39 PM

The proposal to establish Palli Sanchay Bank is being placed before the cabinet today (Monday).

The formation of the bank would be like Grameen Bank in accordance with the draft proposal.

The Banking and Financial Institutions Division of the finance ministry and Bangladesh Bank have already given their consent to the Rural Development and Cooperatives Division proposal, official sources said.

The new bank would emerge from the government’s “One House, One Farm” project.

As per the draft law, the specialised bank would enjoy exemption from value-added and income taxes like Grameen Bank. The bank will be governed under the Banking Companies Act. However, Palli Sanchay Bank’s managing director would be appointed, by the board of directors, with prior permission of Bangladesh Bank.

The bank’s paid-up capital would be Tk2bn, 80% of which will be provided by the government through its “One House, One Farm” project and authorised capital will be Tk10bn.

The government will hold 51% of the bank’s ownership and the remaining 49% would go to the member cooperative societies of the “One House, One Farm” project.

However, the government will not take any dividend against its shares. The board of director of the proposed bank will be 15-member one while eight people to come from the administration and remaining members would come from association members. The tenure of directors will be maximum three years.

The MD will be appointed with prior approval of Bangladesh Bank by the board of directors and the age of the MD will be 65 years, according to the proposal. Assets, officials and staffs of One House, One Farm project will be absorbed in the proposed bank.

Earlier in July, the prime minister asked authorities establish a new specialised bank named Palli Sanchay Bank to avoid the misuse of deposits made by rural poor.

The Ministry of Finance took a decision to establish the bank at a meeting on August 1.  

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