BB tightens rules for banks’ car purchase

Bangladesh Bank (BB) has tightened the rules for banks’ car purchase for avoiding high-value expenses and purchases of luxurious cars with a view to cutting operating expenses.

“Banks would be able to replace cars and other vehicles used by their chairmen and chief executive officers and the lenders if they are at least eight years old,” said a BB circular issued on Wednesday.

On 26 July, amid a fresh round of belt-tightening by the government, the Bangladesh Bank instructed banks not to buy new cars until June 2023.

Besides, banks’ spending for hospitality, travel, furniture and stationery has been slashed by 50 per cent due to the global economic situation.

Earlier, banks were instructed to reduce power and energy costs in line with the government austerity measures.

In 2019, the BB allowed banks to replace their cars and other vehicles dedicated to their chairmen and CEOs with new ones after they age at least five years.