Macro

Contractionary budget in making amid financial constraints

Finance officials are stitching up a contractionary budget for the next fiscal year, officials said, giving top priority to taming
inflation and employment generation. As the government walks tightropes to make ends meet amid both internal and global
economic adversities, the size of the new budget may see an around 5.0-percent rise over the current outlay, to less than Tk 8.0
trillion. The draft budget is set to be placed before the committee for coordination on fiscal, monetary, and currency exchange
today (Thursday).
https://today.thefinancialexpress.com.bd/first-page/contractionary-budget-in-making-amid-financial-constraints-1712167334

Next budget to see marginal hike as austerity measures linger

The government may cut the size of the budget for the ongoing fiscal year while the upcoming one is expected to see a marginal
spike as the country's spending capacity has remained under stress. The austerity stance, driven by the widening gap between
incomes and expenses, is set to persist since the government continues to struggle to rein in inflation and reduce pressure on
foreign currency reserves.
https://www.thedailystar.net/business/economy/news/next-budget-see-marginal-hike-austerity-measures-linger-3581481

Financial account deficit exceeds $8b

The financial account deficit – which comprises foreign direct investment, short-, medium-, and long-term loans, and trade
credits – crossed the $8 billion mark in the July-February period of the fiscal 2023-24, thanks to increased trade credit deficit and
loan repayment pressure. According to the Bangladesh Bank, the financial account deficit amounted to $8.36 billion at the end of
February, reflecting an increase of $574 million from January. This figure contrasts with a $2.32 billion deficit in the equivalent
period of the last fiscal year.
https://www.tbsnews.net/economy/financial-account-deficit-exceeds-8b-822431

IMF stresses reserves target to get third tranche of loan

The International Monetary Fund (IMF) has emphasised meeting the target of the foreign exchange reserve set for March 2024 as
a condition of $4.7 billion in loan support for Bangladesh, reports UNB. The global lender upheld its stand during a meeting with
Bangladesh Bank officials on Wednesday. The IMF team is visiting Bangladesh to assess the financial outlook before releasing
the third installment of the $4.7 billion loan. As per the conditions of the loan from the IMF, it was set as a target to hold
US$19.26 billion in reserves in March 2024. But actual reserves are less than $16 billion.
https://today.thefinancialexpress.com.bd/first-page/imf-stresses-reserves-target-to-get-third-tranche-of-loan-1712167569

Inflation may knock 0.5m Bangladeshis down poverty line

An estimated 0.50-million people in Bangladesh are likely to be pushed down the poverty line in two years under inflationary
pressure, according to World Bank's downbeat economic update. Besides, the moderate poverty rate (at $3.65) may also increase
to 29.4 per cent from 29.3 per cent to stand at 0.84 million, reports the Washington-based lender. "As consumption growth slows
and population increases, almost half a million Bangladeshis are projected to fall into extreme poverty (at $2.15) between
FY2023 and FY2024," reads the Macro Poverty Outlook (MPO) 2023.
https://today.thefinancialexpress.com.bd/first-page/inflation-may-knock-05m-bangladeshis-down-poverty-line-1712167377

NBFI
NBFIs asked to form willful defaulters’ identification unit by April 30
The Bangladesh Bank asked non-bank financial institutions (NBFIs) to form a 'willful defaulters identification unit' within this
month. The unit will identify whether defaulting borrowers (individuals and institutions) are willful defaulters, as per a central
bank notice. If a defaulter is identified to be a willful defaulter as per the Finance Companies Act 2023, the concerned borrower
will get 14 working days to present their statement on the issue.
https://www.thedailystar.net/business/economy/news/nbfis-asked-form-willful-defaulters-identification-unit-april-30-3581256

Banks
Associate firms can take loans if group found not wilful defaulter
Banks can extend loans to companies associated with groups that have defaulted on loans until they are classified as wilful
defaulters. However, in such instances, the process will require approval from the Bangladesh Bank. In a circular issued on
Wednesday (3 April), the central bank upheld the benefits of defaulted borrowers at a time when banks grapple with the
challenge of identifying wilful defaulters among their defaulting customers.
https://www.tbsnews.net/economy/banking/associate-firms-can-take-loans-if-group-found-not-wilful-defaulter-822366

Stocks
Sea Pearl Beach Resort risks being defaulter if regulator rejects ICB condition
Sea Pearl Beach Resort & Spa is at the risk of being labelled as defaulter if it fails to covert bonds worth Tk 1.2 billion into
shares meeting the conditions put forth by the bondholder, state-run Investment Corporation of Bangladesh (ICB). The failure
would lead to the rescheduling of debt of Tk 1.2 billion while the remaining bonds worth Tk 2.05 billion have already been
rescheduled. The Sea Pearl has not been paying installments against the bonds subscribed by the ICB since 2020.
https://today.thefinancialexpress.com.bd/stock-corporate/sea-pearl-beach-resort-risks-being-defaulter-if-regulator-rejects-icb-
condition-1712166027

Paramount Textile shuts down 200MW power plant

Paramount Textile Limited, a subsidiary of Paramount Group, has halted operations of its 200MW power plant following the
expiration of its power purchase agreement with the Bangladesh Power Development Board (BPDB). The publicly listed
Paramount Textile holds a 49% stake in the power plant and had invested over Tk100 crore to construct it in Baghabari,
Sirajganj. The plant started its operations in February 2019. In a disclosure made yesterday, the company stated that the power
purchase agreement between BPDB and Paramount Btrac Energy has lapsed, and the BPDB has declined to extend the contract.
So, the management of the plant made the decision to shut it down.
https://www.tbsnews.net/economy/stocks/paramount-textile-shuts-down-200mw-power-plant-822401

Brac Bank to sell Pragati Life Insurance products

Pragati Life Insurance signed a bancassurance agreement with Brac Bank recently, enabling the bank's customers to conveniently
purchase Pragati Life Insurance's diverse range of insurance products, says a press release. The insurance products include health
insurance, education insurance and other savings-oriented life insurance plans through the bank's extensive network of branches.
https://today.thefinancialexpress.com.bd/trade-market/brac-bank-to-sell-pragati-life-insurance-products-1712163150