Banks cut some service charges FBCCI puts forward a set of proposals

A forum of chief executives of private commercial banks has decided
to reduce some service charges in response to demands placed by the
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI),
the apex trade body. "We sent the revised charge rates to the central
bank and all commercial banks on October 1 ," said K Mahmood Sattar,
chairman of the Association of Bankers Bangladesh (ABB). Sattar, also
the CEO of City Bank, however said ABB could not address all the
demands placed by FBCCI. For instance, he said FBCCI demanded zero
charges for LC acceptance for imports, which is impossible for a bank
to comply with. "A bank charges for LC acceptance because it assumes
risks. Importers accept their goods and pay the banks even after 120
days, and so high risks are involved," the ABB chairman told The
Daily Star yesterday. FBCCI sent a proposal to Bangladesh Bank a few
months back, demanding it pressurise commercial banks to reduce
service charges. Accordingly, BB forwarded the proposal to ABB for
consideration. The association, after consulting matters with its
members, sent a recommendation to the central bank. In 2008 , private
banks reduced charges following a similar demand from the business
community. In the latest proposal, FBCCI demanded discontinuation of
charges in 10 areas related to imports, including LC acceptance and
handling charges and copy documentation endorsement. The trade body
also demanded discontinuation of commissions, overdue interests and
handling charges for export bill negotiations. FBCCI called for
withdrawal of commission and handling charges for export bill
collection. It also demanded reducing the rate for Telex/Swift from
up to Tk 5 ,000 to Tk 1 ,500. "We reduced the rate in many areas, but
we could not address all the demands placed by FBCCI," said Sattar.
Pubali Bank Managing Director Helal Ahmed Chowdhury said all the
banks are trying to reduce several service charges, but they could
not do so in all the cases because of declining demand for investment
in times of global recession. Talking to The Daily Star, FBCCI
President Annisul Huq said he had submitted the proposal on bank
charges to the central bank to create pressure on them to reduce
charges, which he said are "very high". "The central bank told us
that they always maintain pressure on banks in this regard," Huq
said.