Sunday, April 28, 2024
Two publicly traded banks – Dutch-Bangla Bank Ltd (DBBL), and Prime Bank Limited – have announced plan to invest in subsidiaries in bid to expand and diversify their businesses.
The banks disclosed the information through separate filings posted with the Dhaka Stock Exchange (DSE) on Wednesday.
DBBL said its board has given the go-ahead to the plan to invest Tk 12.5 crore in the proposed Digi10 Bank PLC by joining a consortium of 10 banks.
The bank will have a 10 per cent stake in the proposed virtual bank.
The private bank also said its board decided to form a full-fledged merchant bank – Dutch-Bangla Bank Investment Limited – with a proposed paid-up capital of Tk 25 crore.
In addition, the private commercial bank will establish a brokerage house named Dutch-Bangla Bank Securities Limited to act as a stock dealer and broker. The subsidiary will have a paid-up capital of Tk 10 crore.
It will be a fully owned subsidiary, subject to regulatory approvals.
Meanwhile, Prime Bank will provide 10 per cent of the same proposed digital bank’s paid-up capital comprising 10 listed banks, where its investment will be Tk 12.50 crore. This decision will become effective subject to the consent of the concerned regulatory bodies.
The banks involved in the consortium are – The City Bank, Mutual Trust Bank (MTB), National Credit and Commerce Bank (NCCB), Dutch-Bangla Bank Limited, Eastern Bank Limited (EBL), Trust Bank, Pubali Bank, Prime Bank, and Midland Bank Limited. These ten banks are entrepreneurs in the proposed Digi10 Bank PLC.
Ten private sector banks have taken the initiative to establish DG10 Bank Plc to reduce the use of cash currency and make transactions easier. The paid-up capital of the bank will be a minimum of Tk 125 crore.
In addition, Prime Bank will establish a subsidiary company to operate mobile financial services (MFS). The paid-up capital of this company will be Tk 45 crore.
Prime Bank will also establish an asset management company with a paid-up capital of Tk 10 crore. The bank will also set up an asset management company to manage mutual and alternative investment funds.
Earlier, the Bangladesh Bank had invited proposals to form digital banks on June 21 this year. The deadline was initially set for August 1 this year, but later it was extended to August 17 to give entrepreneurs more time to prepare detailed applications with all the necessary documents.
As per the guidelines, a digital bank will have a minimum paid-up capital of Tk 125 crore. The capital will come from sponsors.
