Abu Sazzad :The country’s inter-bank call money market remained stable till yesterday (Monday) due to proactive measures of the central bank and adequate cash in banks.The call money rate is the rate of interest that banks charge other banks or financial institutions for given loans. These loans banks borrow from other banks to cover the shortfall created during festival time as a result of excess withdrawal of cash.Usually, the call money rate sees an abnormal spike ahead of two major festivals – Eid-ul-Fitr and Eid-ul-Azha. Most branches of the banks, especially at Motijheel, Dilkusha and Agrabad, Chittagong witnessed long queues of people before cash payment counters on Monday.Sources in the Bangladesh Bank (BB) said, the central bank has taken a proactive measure by supplying newly printed bank notes of different denominations to ease the shortage of liquidity in the banks. The central bank has also been providing liquidity support to the banks through auction of repo and special liquidity support to the primary dealers (PDs) and non-PDs to ease the pressure on the market during the holy month of Ramzan and Eid-ul-Fitr. Inter-bank call money transactions witnessed a high rate of 6.50 per cent on Monday amid massive withdrawals of cash ahead of Eid-ul-Fitr. The lowest call money rate was 5.25 per cent. The call rate ranged between 5.25 per cent and 6.50 per cent and was unchanged from the previous week. Southeast Bank borrowed the highest amount of Tk 120 crore from the call money market on Monday. “Short-term borrowings, especially from the call money market, normally become necessary in view of the excessive demand for cash from the banks. But this year has been an exception because a substantial amount of fresh funds has been injected by the central bank into the market,” said Bangladesh Bank Executive Director M Mahfuzur Rahman.Saiful Islam, Manager of Pubali Bank, Islamic Banking Branch, said that bank managements had made advance preparations this year to meet the emergency.Besides, managements of different banks have stocked adequate cash for loading in the automated teller machine (ATM) booths time to time to facilitate cash withdrawals by customers, bank official said.”Our officials talked to corporate clients to learn about the extent of their demand for cash. We have made preparations on the basis of such demand,” he said.The call money rate will remain stable till Eid-ul-Fitr as there has been no shortage of liquidity so far in the banking sector, he said.
