Bangladesh Bank to increase forex reserves

From now on, non-resident Bangladeshis will be allowed to open foreign currency account by using photocopy of passport signature or showing signature verified by a notary public.

The central bank issued a circular Sunday asking the authorised foreign exchange dealers to accept the passport photocopies or verifications of notary public, along with other options cited in the non-resident foreign currency deposit (NFCD) guidelines for opening foreign currency account.

Previously, non-resident Bangladeshis had to rush to Bangladesh missions abroad or foreign banks to get their signature verified, a requirement for opening NFCD account.

As of Tuesday, foreign exchange reserve of the country stood at around $1.37bn, a figure which a senior Bangladesh Bank official would not call comfortable.

The governor of the Bangladesh Bank also wrote to Bangladesh missions abroad, seeking their support to inform non-resident Bangladeshis about the existing foreign currency deposit schemes and woo them into opening foreign currency account at home and invest in wage earners' development schemes and capital market.

Meanwhile, the central bank also relaxed the foreign currency dealing, offering the authorised dealers to transact US dollars with Bangladesh Bank at separate rates proposed by them within the band of 53.85 taka to 54.15 taka for a dollar on the basis of market demand.

Since market price of dollars is always higher than the official rate fixed by the central bank, money market experts have long been advocating allowing the market to decide the exchange rate of the dollar. The central bank's decision is one step toward that end, they observed.