But the circular will also have a profound impact on the banks and the banking sector. We estimate the losses to the banks through constructing the profit and loss account for the banking sector as a whole. The circular that blocks charging interest for two months will make relations of Bangladesh banks with foreign banks increasingly difficult. The bank’s P and L statement now looks more or less as it would be without the circular. Bank liquidity: BB must be particularly vigilant of the liquidity position of the commercial banks, particularly third and fourth generation banks during the period of the implementation of the circular.

Source: Dhaka Tribune May 15, 2020 04:07 UTC