Home ›› 10 Nov 2022 ›› Front
The Bangladesh Bank finally recognised the foreign exchange reserves calculation method of the International Monetary Fund (IMF) and declared that the net reserves now stands at $26 billion on Wednesday.
“Now, our net reserves stand at $26 billion after excluding $8 billion as Export Development Fund (EDF) and loans to crisis-hit Sri Lanka,” said Bangladesh Bank governor Abdur Rouf Talukder at a press conference at the Finance Ministry on the day.
“We are publishing gross reserves, but the IMF asked us to publish the net reserves,” said the BB governor adding that now the Bangladesh Bank will show gross reserves and net reserves separately.
Abdur Rouf Talukder said that the EDF is mostly liquid because they are able to liquidate the fund within 120 days if they want.
Before the move, the central bank on October 30 made the decision in principle to calculate forex reserves by excluding invested assets – such as Export Development Fund (EDF) and other loans– as per the requirement of the IMF.
The IMF is holding a series of detailed discussions with regulators and stakeholders regarding Bangladesh’s economy from October 26 to November 9.
Bangladesh is seeking $4.5 billion in loans from the IMF, and the ongoing discussions are part of the process.
As of November 9, the country’s forex reserve stood at $34.52 billion, which come down to $26.52 billion as per the IMF calculation.
Bangladesh Bank has so far invested around $8 billion – including $7 billion in the Export Development Fund (EDF) – from the forex reserves, said the BB officials.
Long Term Fund (LTF) and Green Transformation Fund (GTF) have been formed with the remaining $1 billion. Crisis-hit Sri Lanka also took $200 million in loans from Bangladesh’s forex reserves, show data from the central bank.
Reserves continue to dip
The forex reserves dropped by $10.51 billion in the past one year mainly due to the central bank’s USD selling spree. The banking regulator has been selling USD to banks almost every day.
The regulator injected $5.47 billion into banks between July 1 and November 9 of this fiscal year.
The central bank sold $60 million on Wednesday to banks.
Now, banks, especially the state-run ones, are taking US dollar support from the BB for settling import payments of Bangladesh Petroleum Corporation, Bangladesh Agricultural Development Corporation and Bangladesh Chemical Industries Corporation, among other government agencies.
The central bank had injected a record $7.62 billion from its reserve into banks in the last financial year. The country’s forex reserve was at a record $48 billion in August 2021.
