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Monday, March 30, 2009

Speed Up Your Computer

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5 Ways to speed up your Computer

1.Free up disk space


By freeing disk space, you can improve the performance of your computer. The Disk Cleanup tool helps you free up space on your hard disk. The utility identifies files that you can safely delete, and then enables you to choose whether you want to delete some or all of the identified files.
Use Disk Cleanup to:
• Remove temporary Internet files.
• Remove downloaded program files (such as Microsoft ActiveX controls and Java applets).
• Empty the Recycle Bin.
• Remove Windows temporary files.
• Remove optional Windows components that you don't use.
• Remove installed programs that you no longer use.

Tip: Typically, temporary Internet files take the most amount of space because the browser caches each page you visit for faster access later.

To use Disk Cleanup

1. Click Start, point to All Programs, point to Accessories, point to System Tools, and then click Disk Cleanup. If several drives are available, you might be prompted to specify which drive you want to clean.
2.In the Disk Cleanup for dialog box, scroll through the content of the Files to delete list.
Choose the files that you want to delete.


3.

Clear the check boxes for files that you don't want to delete, and then click OK.

4.

When prompted to confirm that you want to delete the specified files, click Yes.

After a few minutes, the process completes and the Disk Cleanup dialog box closes, leaving your computer cleaner and performing better.

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Speed up access to data

Disk fragmentation slows the overall performance of your system. When files are fragmented, the computer must search the hard disk when the file is opened to piece it back together. The response time can be significantly longer.

Disk Defragmenter is a Windows utility that consolidates fragmented files and folders on your computer's hard disk so that each occupies a single space on the disk. With your files stored neatly end-to-end, without fragmentation, reading and writing to the disk speeds up.

When to run Disk Defragmenter
In addition to running Disk Defragmenter at regular intervals—monthly is optimal—there are other times you should run it too, such as when:

•You add a large number of files.
•Your free disk space totals 15 percent or less.
•You install new programs or a new version of Windows.

To use Disk Defragmenter:

1.Click Start, point to All Programs, point to Accessories, point to System Tools, and then click Disk Defragmenter.
>>Click Analyze to start the Disk Defragmenter.<< 2.In the Disk Defragmenter dialog box, click the drives that you want to defragment, and then click the Analyze button. After the disk is analyzed, a dialog box appears, letting you know whether you should defragment the analyzed drives. Tip: You should analyze a volume before defragmenting it to get an estimate of how long the defragmentation process will take. 3.To defragment the selected drive or drives, click the Defragment button. Note: In Windows Vista, there is no graphical user interface to demonstrate the progress—but your hard drive is still being defragmented. After the defragmentation is complete, Disk Defragmenter displays the results. 4.To display detailed information about the defragmented disk or partition, click View Report. 5.To close the View Report dialog box, click Close. 6.To close the Disk Defragmenter utility, click the Close button on the title bar of the window. -----------------------------------------------------------------------------------------------
Detect and repair disk errors

In addition to running Disk Cleanup and Disk Defragmenter to optimize the performance of your computer, you can check the integrity of the files stored on your hard disk by running the Error Checking utility.

As you use your hard drive, it can develop bad sectors. Bad sectors slow down hard disk performance and sometimes make data writing (such as file saving) difficult, or even impossible. The Error Checking utility scans the hard drive for bad sectors, and scans for file system errors to see whether certain files or folders are misplaced.

If you use your computer daily, you should run this utility once a week to help prevent data loss.

To run the Error Checking utility:

1.Close all open files.

2.Click Start, and then click My Computer.

3.In the My Computer window, right-click the hard disk you want to search for bad sectors, and then click Properties.

4.In the Properties dialog box, click the Tools tab.

5.Click the Check Now button.

6.In the Check Disk dialog box, select the Scan for and attempt recovery of bad sectors check box, and then click Start.


7.If bad sectors are found, choose to fix them.

Tip: Only select the "Automatically fix file system errors" check box if you think that your disk contains bad sectors.
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Protect your computer against spyware

Spyware collects personal information without letting you know and without asking for permission. From the Web sites you visit to usernames and passwords, spyware can put you and your confidential information at risk. In addition to privacy concerns, spyware can hamper your computer's performance. To combat spyware, you might want to consider using Microsoft Windows Defender, which is included in Windows Vista, and is available as a free download for Microsoft XP SP2. Alternatively, there are other free anti-spyware software programs available.

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Learn all about ReadyBoost

If you're using Windows Vista, you can use ReadyBoost to speed up your system. A new concept in adding memory to a system, it allows you to use non-volatile flash memory—like a USB flash drive or a memory card—to improve performance without having to add additional memory. Learn more.


Article Author :microsoft.com/atwork/getstarted/speed.mspx

Saturday, March 28, 2009

How To Earn Money From My Website Or Blog

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Many Ways to Make Money with Your Website

There are several lists with “ways to make money with a website” on the Internet, but none of them seem to be complete. That is why I decided to create this one. If you know a method that is not listed below, just let us know and we’ll update it.

Notice that ways to make money with a website are different from ways to make more money from it. Methods to increase your traffic or click-through rate will help you make more money, but they do not represent a method of making money per se.
For example, one could suggest that blending AdSense ads with the content is a way to make money from a website. In reality it’s not; it’s just a way to make more money by improving your ad click-through rate. The real monetization method behind it is a PPC ad network.

The list is divided into direct and indirect methods, and examples and links are provided for each point. Enjoy!


1. PPC Advertising Networks


Google AdSense is the most popular option under this category, but there are also others. Basically you need to sign up with the network and paste some code snippets on your website. The network will then serve contextual ads (either text or images) relevant to your website, and you will earn a certain amount of money for every click.

The profitability of PPC advertising depends on the general traffic levels of the website and, most importantly, on the click-through rate (CTR) and cost per click (CPC). The CTR depends on the design of the website. Ads placed abode the fold or blended with content, for instance, tend to get higher CTRs. The CPC, on the other hand, depends on the nice of the website. Mortgages, financial products and college education are examples of profitable niches (clicks worth a couple of dollars are not rare), while tech-related topics tend to receive a smaller CPC (sometimes as low as a couple of cents per click).

The source of the traffic can also affect the overall CTR rate. Organic traffic (the one that comes from search engines) tends to perform well because these visitors were already looking for something, and they tend to click on ads more often. Social media traffic, on the other hand, presents terribly low CTRs because these visitors are tech-savvy and they just ignore ads.

List of popular CPC advertising networks:
Google Adsense
Yahoo! Publisher Network (YPN)
BidVertiser
Chitika
Clicksor

2. CPM Advertising Networks

CPM advertising networks behave pretty much as PPC networks, except that you get paid according to the number of impressions (i.e., page views) that the ads displayed on your site will generate. CPM stands for Cost per Mille, and it refers to the cost for 1,000 impressions.

A blog that generates 100,000 page views monthly displaying an advertising banner with a $1 CPM, therefore, will earn $100 monthly.

CPM rates vary with the network, the position of the ad and the format. The better the network, the higher the CPM rate (because they have access to more advertisers). The closer you put the ad to the top of the page, the higher the CPM. The bigger the format (in terms of pixels), the higher the CPM.

You can get as low as $0,10 and as high as $10 per 1,000 impressions (more in some special cases). CPM advertising tends to work well on websites with a high page views per visitor ratio (e.g., online forums, magazines and so on).

List of popular CPM advertising networks:
Casale Media
Burst Media
Value Click
Advertising.com
Tribal Fusion
Right Media

3. Direct Banner Advertising

Selling your own advertising space is one of the most lucrative monetization methods. First and foremost because it enables you to cut out the middleman commissions and to determine your own rates. The most popular banner formats on the web are the 728×90 leaderboard, the 120×600 skyscraper, the 300×250 rectangle and the 125×125 button.

The downside of direct banner advertising is that you need to have a big audience to get qualified advertisers, and you will need to spend time managing the sales process, the banners and the payments.

Related links:
How to Find Advertisers for Your Website
Finding Advertisers for Your Blog
Direct Advertising Sales for Beginners
Openads Ad Server
OIO Publisher Ad Platform

4. Text Link Ads

After Google declared that sites selling text links without the nofollow tag would be penalized, this monetization method became less popular.

Many website owners are still using text links to monetize their sites, though, some using the nofollow tag and some not.

The advantage of this method is that it is not intrusive. One can sell text links directly through his website or use specialized networks like Text-Link-Ads and Text-Link-Brokers to automate the process.

Text link marketplaces and networks:
DigitalPoint Link Sales Forum
Text-Link-Ads
Text-Link-Brokers
TNX
LinkWorth

5. Affiliate Marketing

Affiliate marketing is a very popular practice on the Internet. Under this system you have a merchant that is willing to let other people (the affiliates) sell directly or indirectly its products and services, in exchange for a commission. Sometimes this type of advertising is also called CPA (cost per action) or CPL (cost per lead) based.

Affiliates can send potential customers to the merchant using several tools, from banners to text links and product reviews.

In order to find suitable affiliate programs you can turn to individual companies and publishers like Dreamhost and SEOBook, or join affiliate marketplaces and networks.

List of popular affiliate marketplaces and networks:
Commission Junction
ClickBank
Azoogle Ads
Link Share

6. Monetization Widgets

The latest trend on the web are widgets that let you monetize your website. Examples include Widgetbucks and SmartLinks. Some of these services operate under a PPC scheme, others behave like text link ads, others yet leverage affiliate links.

Their main differentiator, however, is the fact that they work as web widgets, making it easier for the user to plug and play the service on its website.

List of companies that provide monetization widgets:
WidgetBucks
ScratchBack
SmartLinks

7. Sponsored Reviews

PayPerPost pioneered this model, with much controversy on the beginning (related to the fact that they did not require disclosure on paid posts). Soon other companies followed, most notably Sponsored Reviews and ReviewMe, refining the process and expanding the paid blogging model.

Joining one of these sponsored reviews marketplaces will give you the opportunity to write sponsored posts on a wide range of topics. Not all bloggers are willing to get paid to write about a specific product or website (because it might compromise the editorial credibility), but the ones who do are making good money out of it.

If your blog has a big audience you could also offer sponsored reviews directly, cutting off the commissions of the middleman.

List of sponsored reviews and paid blogging networks:
PayPerPost
Sponsored Reviews
ReviewMe
BlogVertise
Smorty

8. RSS Feed Ads

With the quick adoption of the RSS technology by millions of Internet users, website owners are starting to find ways to monetize this new content distribution channel.

Feedburber already has its own publisher network, and you can sign-up to start displaying CPM based advertising on your feed footer. Bidvertiser recently introduced a RSS feed ad option as well, with a PPC scheme.

Finally, some blogs are also opting to sell banners or sponsored messages on their feed directly. John Chow and Marketing Pilgrim are two examples.

Related links:
Feedburner
BidVertiser
Pheedo

9. Sponsors for Single Columns or Events

If you website has specific columns or events (e.g., a weekly podcast, an interview series, a monthly survey, a special project) you could find companies to sponsor them individually.

This method increases the monetization options for website owner, while giving advertisers the possibility to target a more specific audience and with a reduced commitment.

Mashable illustrates the case well. They have several advertising options on the site, including the possibility to sponsor specific columns and articles, including the “Daily Poll” and the “Web 2.0 Invites.”

Problogger also runs group writing projects occasionally, and before proceeding he publicly announce the project asking for sponsors.

10.Premium Content

Some websites and blogs give away part of their content for free, and charge for access to the premium content and exclusive tools.

SEOMoz is a good example. They have a very popular blog that gives advice and information on wide range of SEO related topics. On top of that visitors can decide to become premium members. It costs $48 monthly and it grants them access to guides, tools and other exclusive material.

11. Private Forums

While the Internet is populated with free forums, there is also the possibility to create a private one where members need to pay a single or recurring fee to join.

SEO Blackhat charges $100 monthly from its members, and they have thousands of them. Obviously in order to charge such a price for a forum membership you need to provide real value for the members (e.g., secret techniques, tools, and so on).

Performancing also launched a private forum recently, focused on the networking aspect. It is called The Hive, and the monthly cost is $10.

These are just two examples. There are many possibilities to create a private and profitable forum, you just need to find an appealing angle that will make it worth for the members.

List of popular forum software:
vBulletin
Simple Machines Forum
phpBB
Vanilla

12. Job Boards

All the popular blogs are trying to leverage job boards to make some extra income. Guy Kawasaki, ReadWriteWeb, Problogger… you name it.

Needless to say that in order to create an active and profitable job board you need first to have a blog focused on a specific niche, and a decent amount traffic.

The advantage of this method is that it is passive. Once you have the structure in place, the job listings will come naturally, and you can charge anywhere from $10 up to $100 for each.

List of popular job board software:
JobThread
Web Scribe Job Board
SimplyHired Job-o-matic
Jobbex

13. Marketplaces

Sitepoint is the online marketplace by excellence. Some websites and blogs, however, are trying to replicate that model on a smaller scale.

Depending on your niche, a market place that allows your visitors to buy, sell and trade products could work well. Over the time you could start charging a small fee for new product listings.

The problem with this method is that there are no standard software on the web, so you would need to hire a coder to get a marketplace integrated into your website.

You can see an example of a marketplaces being used on EasyWordpress and on Mashable.

14. Paid Surveys and Polls

There are services that will pay you money to run a small survey or poll on your website. The most popular one is called Vizu Answers.

Basically you need to sign up with them, and select the kind of polls that you want to run your site. Most of these services operate under a CPM model.

15. Selling or Renting Internal Pages

Million Dollar Wiki made this concept popular, but it was being used on the web for a long time around (check Pagerank10.co.uk for instance).

These websites sell for a single fee or rent for a recurring fee internal pages on their domain. Usually they have either high Pagerak or high traffic, so that people purchasing a page will be able to benefit in some way.

Implementing this method on a small blog would be difficult, but the concept is interesting and could be explored further.

16. Highlighted Posts from Sponsors

Techmeme probably pioneered this idea, but somehow it has not spread to other websites. The tech news aggregator displays editorial posts on the left column, and on the sidebar they have a section titled “Techmeme Sponsor Posts.”

On that section posts from the blog of the advertisers get highlighted, sending qualified traffic their way. Considering that the monthly cost for one spot is $5000 and that they have around 6 sponsors at any given time, it must be working well.

17. Donations

Placing a “Donate” link or button on a website can be an efficient way to earn money, especially if your blog is on a niche where readers learn and gain value from your content.

Personal development and productivity blogs, for instance, tend to perform well with donation based systems (one good example being Steve Pavlina).

A small variation of this method appeared sometime ago with the Buy Me a Beer plugin. This WordPress plugin enables you to insert a customized message at the bottom of each article, asking the readers to chip in for a beer or coffee.

18. In-text Adverting

In-text adverting networks like Kontera and Vibrant Media will place sponsored links inside your text. These links come with a double underline to differentiate them from normal links, and once the user rolls the mouse over the link the advertising will pop. Should the user click on it the site owner will make some money.

Some people make good money with this method, but others refrain from using it due to its intrusiveness. It is also interesting to note that very few mainstream websites have experimented with in-text advertising.



20. Audio Ads

Also called PPP (Pay Per Play), this advertising method was introduce by Net Audio Ads. the concept is pretty simple: play a small audio advertising (usually 5 seconds) every time a visitor enters into your website. The user should not be able to stop it, creating a 100% conversion rate based on unique visitors.

The company is still rolling tests, but some users are reporting to get from a $4 to a $6 CPM. Regardless of the pay rate, though, this is a very intrusive form of advertising, so think twice before using it.

21. Selling the Website

Selling your website could be your last resource, but it has the potential to generate a big sum of money in a short period of time.

Market places on online forums like DigitalPoint and Sitepoint are always active with website buyers and sellers. Keep in mind that they most used parameter to determine the value of a website is the monthly revenue that it generates, multiplied by a certain number (the multiplier can be anything from 5 to 30, depending on the expectations of the seller, on the quality of the site, on the niche and other factors).

Some people also make money trading and flipping websites. They either create them from scratch or buy existing ones, and after some revamping they sell them for a profit.

Related links:
How To Buy A Website And Flip It For Profit
How To Sell A Website - How Much Is Your Website Worth?
Where to sell a website? How to go about selling it?
Indirect Methods

22. Selling an Ebook

Perhaps one of the oldest money making strategies on the web, using a website to promote a related ebook is a very efficient way to generate revenue.

You could either structure the website around the book itself, like SEOBook.com, or launch the ebook based on the success of the website, like FreelanceSwitch did we the book How to be a Rockstar Freelancer.

Related links:
Writing an ebook for your blog
How to sell ebooks
Processing payments for your ebook
How to sell digital products online
List of ebook selling software




25. Offering Consulting and Related Services

Depending on your niche, you could make money by offering consulting and related services. If you are also the author of your blog, the articles and information that you will share will build your profile and possibly certify your expertise on that niche, making it easier to gain customers.

Chris Garrett used a similar strategy. First he created a highly influential blog on the blogging and new media niche, and afterwards he started offering consulting services to clients with related problems and needs.

26. Creating an Email List or Newsletter

Email lists and newsletters represent one of the most powerful marketing and money making tools on the Internet. They offer incredible conversion rates, and the possibility to call people to action in a very efficient way.

Creating a big list is a difficult task though, so if you have a popular website you could leverage it to increase the number of subscribers on your list.

Yaro Starak is a famous Internet marketer, and if you visit his blog you will notice that right on top he has a section encouraging visitors to subscribe to his email newsletter. Yaro generates five figures in revenues each month from his email newsletters, proving that this method works.

List of software to manage email newsletters:
AWeber
SendStudio NX
PHP Autoresponder
Constant Contact


Article Author : DailyblogTips

Tuesday, March 24, 2009

Summit Alliance Port to acquire OCL shares

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Summit Alliance Port Ltd (SAPL) will issue 2,790,146 shares of Tk. 100 each totalling Tk. 279,014,600 for acquisition of approximately cent percent stakes of Ocean Containers Limited (OCL).

SAPL is a listed company while OCL is a sister concern of the former.

The amount on account of the acquisition will be Tk 237,999,450 (consisting of 23,799,945 shares of Tk. 10 each) by exchange of one Summit Alliance Share for eight point fifty three Ocean Containers shares, according to a website news of Dhaka Stock Exchange (DSE).

However, the acquisition needs approval from the SAPL shareholders and the Securities and Exchange Commission (SEC) under section 155(2) of the Companies Act, 1994 and rule 3 of the Securities and Exchange Commission (Capital Issue of Companies) Rules, 2001.

An extra-ordinary general meeting (EGM) of the shareholders of the SAPL will be held on April 27 at 10:00 a.m. to approve the proposal.

SAPL provides off-dock services with the inland container depot and container freight station having facilities for handling of both import and export cargoes.

SAPL floated one million shares of Tk 100 each worth Tk 100 million for the general shareholders during the subscription period ended in late August of 2008.

Per share of the company on DSE rose to Tk 1845.00 Monday, but closed at Tk 1790.25, a 5.06 per cent rise against the previous day.

The Financial Express

Body on implementing BASEL-II for NBFIs

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The Bangladesh Bank (BB) has decided to form a committee to implement BASEL-II accord, the latest version of capital standards set for banks worldwide, in the Non-Banking Financial Institutions (NBFIs).

BB deputy governor Murshid Kuli Khan disclosed this while inaugurating a day-long seminar on Prospects and Problems of Financial Institutions organised by the Bangladesh Leasing and Finance Companies Association (BLFCA) in a city hotel Monday.

BLFCA chairman Anis A Khan and its vice chairman Mafizuddin Sarker also spoke at the seminar.

"The BB has already sent letters regarding implementation of BASEL-II in the NBFIs to make their financial base strong as well as banks," Khan said adding that the implementation of BASEL-II in banking sector that started from January this year will be ended by 2011.

Such initiative would help prepare the local financial institutions to safely navigate through to future, he said.

Expressing concern over the non-performing loan (NPL) recovery by the NBFIs, Khan said, "Some NBFIs' performance to recover NPL is not satisfactory. Mismatch between assets and liabilities are worrisome for the institutions."

"Please be careful in disbursing credit," he said and suggested to diversify their products to make their service more competitive.

Factors like risk management guidelines, corporate governance and lack of quality manpower are the stumbling block for the further growth of the NBFIs, said the BB deputy governor.

"Merger and acquisition between each other is necessary for strong financial footing. However, nobody is yet to come forward for merger," he said.

He, however, appreciated the role played by the FIs in keeping the wheel of the country's economy moving despite several constraints.

Admitting the fact, BLFCA chairman Anis A Khan said, "BB is quite right and accurate in its assessment."

"But we need some more time to standardise this sector," he said adding that attempt also will be made to merge in order to comply the BASEL-II.

Narrating the problems faced by the NBFIs, he said, "One of the biggest problems faced by this sector is the paucity of fund and coast of fund which are hindering their growth."

He said, the competitive environment of the sector is challenging as we have to compete with banks. Banks have very low cost of fund.

Currently, twenty nine NBFIs are operating in the country. Of these, one is state-owned, 15 are private and the other thirteen are established joint venture with foreign participation.

The 29 NBFIs offer a divers array of products and services ranging from traditional leases to term loan, short term loan, factoring, home and auto loans, syndication services, merchant banking, stock brokerage services, securitization, credit card operation and a host of other offerings.

Basel II is based on three pillars: minimum capital requirement, supervisory review process and market discipline. Three-types of risks - credit risk, market risk and operational risk-have to be considered under the minimum capital requirement.

The Financial Express

BB plans to maintain remittance inflow

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Remittance from major countries goes down by Tk 246 crore in February when the country receives Tk 3,682 crore compared to Tk 3,928 crore in January

In the wake of falling remittance, the central bank is planning some strategic measures to keep the major foreign currency channel flowing at a comfortable level.
‘We have reviewed country-wise remittance inflow from the Bangladeshi expatriates that shows the earning is yet to shrink,’ the chief economist of Bangladesh Bank, Mustafa K Mujeri, told New Age recently.
Without elaborating, he said the BB would recommend the government some strategies to attract more remittance from different countries.
‘We believe that the remittance inflow will not be reduced soon as the countries where Bangladeshi workers work, will not be affected by the downturn in the short run, but they will be affected if the financial crisis lingers,’ he added.
Bangladesh high commissions in the United Kingdom and Canada recently sent letters to the finance ministry and the Bangladesh Bank, asking them to take necessary actions to increase the remittance from the two countries.
In the letter, Bangladesh high commission in the UK has requested the Bangladesh Bank to sit with the UK’s Financial Services Authority for extra financial benefit on the remittance sent by Bangladeshi expatriates in UK.
The Financial Services Authority is an independent, quasi-judicial non-governmental body and a company limited by guarantee that regulates the financial services industry in the United Kingdom.
Bangladeshi high commission in Canada has also requested the government to extend help to the Bangladeshi origin Canadian agencies which send remittance.
These large foreign companies have been engaged in a competition in a manner that smaller agencies are wiped out from the market in the wake of global recession.
The remittance from the European Union, United Kingdom and Germany has gone down during July-December period in 2008. In the last six months it dropped by 16 per cent from European Union, 15.9 per cent from the United Kingdom and 20 per cent from Germany.
Besides, the remittance from the Middle Eastern countries declined by Tk 246 crore during February compared to January 2009.
According to media reports, the global recession is yet to impact on the Saudi economy but its neighbouring countries have already been affected by the downturn. The Bangladeshi expatriates have also returned from two other major labour markets — Malaysia and Singapore.
Regarding the Bangladeshi expatriates’ return from Malaysia, Mustafa K Mujeri said that it would have a temporary affect on the country’s remittance as the problem would hopefully be resolved soon.
Also he said the government would bring more remittance from the unofficial channel to the official channel and would find out new markets and avenues for manpower exports.
In this connection, he recommended that the local non-government organisations and post offices can be used to bring remittance from Bangladeshi expatriates to their families in rural areas.
KAS Murshid, research director of the Bangladesh Institute of Development Studies, said the global recession was yet to affect the country’s remittance inflow, but the government needed to offer financial incentive package for the Bangladesh expatriates.
‘In the worst scenario, more people will go below the poverty line. So the government must evolve new strategies to reduce poverty,’ he added.
Latest data of the central bank showed that the remittance from the major countries amounted to $569 million (Tk 3,928 crore) in January, and in February it dropped to $534 million (Tk 3,682 crore). In February the country received $260 million from Saudi Arabia, $150 million from the United Arab Emirate, $24 million from Oman, $10 million from Bahrain, $71 million from Kuwait, $20,000 from Libya and three lakh dollars from Iran.
The New Age

United Airways to go public this year

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Private carrier United Airways plans to raise Tk 100 crore through an initial public offering (IPO), evidence of becoming the first listed airline in Bangladesh stock market.

The airline will use the capital in expanding its horizon in international flight operations, officials said.

“We hope we can float our shares on the stock market within this year,” Tasbirul Ahmed Choudhury, chairman and managing director of United Airways (BD) Ltd, told The Daily Star yesterday.

Another senior official of the airline however said it plans to go public by October.

“We have already appointed AAA consultant and financial advisers as underwriter and issue manager,” he said, adding that the company will purchase an aircraft to run it on international routes.

The face value of each share will be Tk 100.

Welcoming the move, market experts said it will be a milestone for Bangladesh's capital market, as such listing is the first time for a an airline here.

“The initiative will increase the market depth besides bringing about a structural change,” said Professor Salahuddin Ahmed Khan of the Finance Department at Dhaka University.

It also proves that the stock market can act as a financing industry, he said.

“The regulators, market authorities, investors and other stakeholders should provide support to the airline so that it can easily be listed with bourses,” he added.

The United Airways, a venture of non-residents Bangladeshis (NRBs), has already planned to expand its global operations and is expecting to fly to new destinations, including the Gulf aviation hub of Dubai, Kuala Lumpur and Kathmandu, by mid-2009.

A 170-seater MD-83 aircraft for $9 million (Tk 62 crore) will be added to its existing two-carrier fleet by May. Earlier, the airline purchased two Dash 8-100 aircraft for about $8.5 million (Tk 57 crore) each.

The carrier recorded a turnover of about Tk 41 crore in 2008 and targets a Tk 140 crore turnover this year.

United Airways, which entered the domestic aviation market in July 2007, has some 500 shareholders, 95 percent of which are NRBs living in the UK. It started its domestic passenger flights on July 10, 2007 and presently operating on Dhaka-Sylhet, Dhaka- Chittagong, Dhaka-Cox's Bazar, Dhaka-Jessore and Dhaka-Barisal routes.

It entered into the international arena on September 24, 2008 by launching its Dhaka-Kolkata flight.

The private sector airline on Sunday announced that it is scheduled to begin operations on the Chittagong-Kolkata route from March 30 to cater to the growing needs of the residents of the port city.

At a press meet in Chittagong, the airline officials said the company eyes to stretch its wing further in the next five years with an investment of Tk 2,000 crore. In order to meet that challenge, it plans to begin operations on the Dhaka-Kathmandu, Dhaka- Kuala Lumpur, Dhaka-Dubai and Chittagong-Bahrain routes very shortly.


The Daily Star

Monday, March 23, 2009

NON BANKING FINANCE INDUSTRIES OF BANGLADESH [NBFIS]

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Non-bank Financial Institutions

The non-bank financial institutions (NBFIs) constitute a rapidly growing segment of the financial system in Bangladesh. The NBFIs have been contributing toward increasing both the quality and quantity of financial services and thus mitigating the lapses of existing financial intermediation to meet the growing needs of different types of investment in the country. At present, 29 NBFIs are operating their business across the country of which one is government owned, 15 are privately owned local companies, and the remaining 13 are established under joint venture with foreign participation.

Asset Liability Position of NBFIs
Total assets of NBFIs showed a growth of 28.2 percent and stood at Tk.90.2 billion in June 2008 compared with Tk.70.4 billion in June 2007. Leased assets constituted about 36.5 percent of total 72 assets of the NBFIs while term financing and working capital generated 27.3 percent and 16.1 percent respectively. Figure 4.4.1 shows that among different types of assets of NBFIs, working capital has increased significantly which indicates better capacity of the NBFIs to mitigate any financial mismatch by balancing current assets with current liabilities. However, three out of the existing 29 NBFIs showed negative position of working capital during the period which indicates that they need to be more efficient in their current liabilities and liquidity management. Up to June 2008, Delta Brac Housing (DBH), which holds about 83 percent of total housing finance of NBFIs, ranked the top in terms of share in total assets (11.2 percent) of the sector followed by the IDLC Finance Limited (9.4 percent). There exists considerable variation in terms of asset holding by NBFIs as 57.3 percent of the assets of the entire sector is accounted for by top nine of them while the bottom nine holds only 9.4 percent of total assets.

Performance of NBFIs

The NBFIs are increasingly coming forward to provide credit facilities for meeting the
diversified demand for investment fund in the country's expanding economy. According to the available data (provisional), private sector credit by NBFIs grew at the rate of 38.7 percent and stood at Tk.108.6 billion at the end of December 2008 which was Tk.78.3 billion in December 2007 (Figure 4.4.2). The outstanding position of industrial lending by NBFIs also increased by 10.4 percent to Tk.61.4 billion at the end of December 2008 compared with Tk.55.6 billion in December 2007. However, overdue as a share of outstanding industrial loans increased to 8.0 percent in December 2008 from 6.8 percent in December 2007. This shows that the NBFIs need to streamline their loan disbursement methods with focus on low risk industrial segments and instill better monitoring mechanisms in order to reduce risks associated with their assets. 73
Nevertheless, the contribution of NBFIs to industrial financing still remains very small. During July-December 2008, the share of the NBFIs in total disbursed industrial loans was only 4.2 percent. More than 80 percent of the loans disbursed by NBFIs were term lending as their capital structure provides better support for term financing rather than working capital financing. Total classified loan of all NBFIs stood at Tk.7.1 billion in December 2008 against their total outstanding loan of Tk.106.1 billion showing a classified loan to total outstanding ratio of 6.7 percent which was 7.1 percent at the end of December 2007.
The return on equity (ROE), which shows the earning capacity of shareholder’s book value investment, shows significant variation across NBFIs. In June 2008, the highest ROE is observed for IDCOL (24.1 percent) followed by Prime Finance (22.9 percent) and DBH (20.9 percent). On the other hand, ROEs of several NBFIs were lower than the industry average and the interest rate on deposits indicating requirements on the part of these NBFIs to access both low cost funding and ensure better portfolio management to improve performance.


Role of Bangladesh Bank

The Bangladesh Bank (BB), as the regulator of NBFI operations in the country, has been
pursuing policies and taking measures to ensure healthy and efficient expansion of NBFI
activities in the country. In order to bring the NBFIs under an effective risk management system, BB identified four core risk areas in September 2005 covering credit risk management (CRM), asset and liability management (ALM), internal control and compliance (ICC), and information and communication technology (ICT). The BB also provided guidelines for the NBFIs to develop structures and undertake measures to improve their institutional risk management system in core risk areas. In line with core risks management guidelines, BB also introduced risk based audit system generally known as 'system audit' for the NBFIs. For the purpose, the Department of Financial Institutions and Market (DFIM) conducted a special inspection on the basis of these core risk areas in IDLC and Union Leasing Company Limited in July 2007. After modifications of the audit process based on the findings of this first phase inspection, the second phase inspection has started in January 2009 in IPDC and Prime Finance Limited. The remaining NBFIs would be brought under the audit system in phases. BB also plans to rank the NBFIs on the basis of their compliance status of core risk management guidelines. Against the backdrop of the global financial crisis, NBFIs have been asked to be cautious in their financial management. As a part of better management, BB has instructed the NBFIs whose classified loan to total outstanding loan ratios have risen sharply to take adequate steps to realize the default loans. The BB has asked the NBFIs to take measures to rationalize investment portfolios and overcome other adverse trends such as provision shortfalls. The NBFIs have been instructed to comply with the Anti-Money Laundering Ordinance 2008 and inform the Anti- Money Laundering Department of BB of any suspicious transactions. The BB has also taken initiatives for ensuring better corporate governance of the NBFIs through streamlining the managing boards for enhancing efficiency and accountability. The NBFIs on their part need to diversify in financial instruments and commercial papers to raise adequate funds from the market so that they can minimize their dependence on borrowing from the inter-bank money market at higher interest rates in times of need. In this respect, assistance needs to be provided to the NBFIs for securitizing and selling quality financial assets. Since the NBFIs serve as important complements to the banking sector in meeting the financing needs that are not well suited to the banks, the development of the NBFIs is crucial to ensuring a sound financial system in the country. It is important to view the NBFIs as a catalyst to conomic growth and provide necessary support and guidance for their development within a longer term framework which would improve financial intermediation and enable the NBFIs to play their due role in overall development of the country.

Friday, March 20, 2009

Stocks rise worldwide

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‘Share Bazaar’ begins

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DSE turnover sets new record on profit-taking

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Stocks on losing curve

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Indices on the Dhaka Stock Exchange continued to fall for a fourth day with the single-day turnover touching the highest-ever level of Tk 647.97 crore yesterday.

The previous highest single-day turnover was recorded at Tk 611.98 crore on March 12.

Apart from a liquidity glut in the market, investors' quick transition from one stock to another to book short-term gains was part of the reason for the highest turnover during the last couple of weeks, market analysts said.

“The investors become short-term traders. Their quick move from one security to another increase turnover,” Arif Khan, deputy managing director of IDLC Finance, told The Daily Star.

Interest rate cuts by the central bank and higher margin loans provided by merchant banks and brokerage houses to investors created a liquidity glut in the market, he said.

The benchmark index of the premier bourse, DSE General Index, fell 7.36 points, or 0.28 percent, to 2,622.77. The DSE All Share Price Index marginally declined 8.23 points, or 0.37 percent, to 2,179.26.

The decliners beat the advancers 143 to 110. Five scrips remained unchanged. A total of 3,54,47,170 shares traded on the prime bourse.

Summit Power topped the turnover leaders with 4,13,100 traded shares worth Tk 47.43 crore.

The day's other turnover leaders were Beximco, Beximco Pharma, BSRM Steels, Titas Gas, S Alam Cold Rolled Steels, Eastern Housing, Summit Alliance Port, Aftab Automobiles and Shinepukur Ceramics.

Chittagong stocks also recorded a fall. The CSE Selective Categories Index declined 30.02 points, or 0.72 percent, to 5,207.05. The CSE All Share Price Index fell 58.92 points, or 0.72 percent, to 8,068.40.

A total of 65,99,365 shares worth Tk 74.40 crore changed hands on the port city bourse. Of the 172 traded securities, 71 advanced, 98 declined and three remained unchanged.

Beximco topped the turnover leaders on the CSE with Tk 4.52 crore in 2,08,800 traded shares.

Other turnover leaders were Summit Power, Beximco Pharma, Jamuna Oil, BSRM Steels, Shinepukur Ceramics, Aftab Automobiles, Eastern Housing, Meghna Petroleum and AIMS 1st Mutual Fund.

The daily star

Five-star hotels may offload shares

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The government plans to offload shares of Pan Pacific Sonargaon and Dhaka Sheraton hotels on the stock market to incorporate common people in these two five-star hotels, Civil Aviation and Tourism Minister GM Quader said yesterday.

“The legal aspects are being examined. If the existing law does not allow listing of Sonargaon and Sheraton hotels on the stock exchanges, we will initiate a move to bring amendments to the law,” Quader said in his address to the opening function of a three-day fair on share market.

Dhaka Sheraton is organising the exhibition titled “Share Bazar Mela” on its premises.

Hotels International Limited, a public limited company, fully owned by the government, is the owning company of Sonargaon Hotel.

The five-star hotel had been built under a loan sanctioned from Overseas Economic Cooperation Fund, now Japan Bank of International Cooperation of the Japanese government and the government of Bangladesh.

Sheraton, 99.68 percent owned by Bangladesh Services Limited, a public limited company of the government, is another five-star hotel in a prime location of the city. The Board of Directors consists of 11 members who are nominated by the government. The civil aviation & tourism secretary is the chairman of the board.

“The hotels have no credit crunch. Bank loans have been taken for the hotels' expansion and modernisation, and the loans are being repaid timely," said GM Quader.

“We are also interested to list other hotels and motels, which are under the tourism ministry.”

Quader said a huge fund is needed for national flag carrier Biman Bangladesh Airlines' restructure and expansion.

“We want to raise the fund from stock market instead of borrowing from banking sector. Capital raised from stock market is more cost-effective than that from banks,” he said.

He said the ordinance, under which Biman was made a public limited company, is waiting to be a law and after enactment of the law, there will be no barrier to offloading Biman shares.

The minister however said Biman's share offloading process might be delayed because of some pre-conditions set by the Securities and Exchange Commission (SEC).

As per the conditions, an issuer company will have to make steady profits for a few consecutive years for being listed. “But Biman made profit only last year. If the SEC offers flexibility, the share offloading process will be accelerated,” the minister added.

Acting SEC Chairman Mansur Alam, Dhaka Stock Exchange President Rakibur Rahman, Chittagong Stock Exchange Vice President Al Maruf Khan and Dhaka Sheraton General Manager Trevor McDonald also spoke at the function.


The Daily Star

Thursday, March 19, 2009

Investors, brokers see bias in DSE move

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Investors and brokers, angered by the bourse's decision to halt trade of Aftab Automobiles and Eastern Housing shares, have alleged that the DSE's move is discriminatory in monitoring trade practices.

Even though the trade of Eastern Housing shares resumed yesterday, the trade of Aftab Automobile shares did not.

The Dhaka Stock Exchange (DSE) management halted the trade of the two companies on Tuesday for a market probe, in response to unusual price jumps of shares.

The share prices of several companies soared more than Aftab and Eastern, but the DSE overlooked those, aggrieved investors and brokers said.

“It's a biased decision,” said a broker.

The prices of each Beximco Synthetics share almost doubled in just five days, while the prices of Bangladesh Welding Electrodes (BD Welding), Kay&Que and Olympic Industries shares soared by more than 100 percent in the last two and a half months, he cited.

“But the DSE management did not halt trade of those issues,” he said.

The DSE management however denied any bias in monitoring trade. “We did it to make a market probe,” said AFM Shariful Islam, chief executive officer of DSE.

Asked why they did not take steps against shares whose prices doubled or trebled in the last two and a half months, he replied, “We are observing the price movement of those issues.”

In response to an inquiry regarding the factors, the DSE might have considered before halting the trade of Aftab and Eastern shares, the CEO said, “The price hike was one factor.”

He however did not disclose the other reasons, saying, “We will disclose the other factors after the inquiry."

An investor, nicknamed Mannan, said the DSE management could not present any valid reason to explain the suspension of trade of the two companies.

“The DSE was pressurised to take the decision by some member of the board of directors, who would benefit from the halt,” he alleged.

“If the DSE gave the same treatment to the other scrips, whose prices rocketed, then we would not raise any allegations,” he said.

Denying the allegations, DSE President Rakibur Rahman said the Board of Directors has no influence over management.

Meanwhile, Aftab Automobiles, in response to the DSE probe, said they do not have any undisclosed material, decision or information relating to the company's operation or profitability that might have an impact on the price and volume of their shares traded in the stock exchange.

The company however said they are exploring possibilities of BMRE of their assembling and body building units and fund raising thereto. The exploration is at a preliminary stage, it said.

Eastern Housing said they do not have any undisclosed materials, facts, decisions, or information relating to the company's operations and profitability that may influence share prices.

The Daily Star

BSRM's billet plant goes into operation by August

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BSRM Group, a leader in iron and steel manufacturing in Bangladesh, is setting up a high quality billet making plant in Chittagong to ensure a steady supply of quality billets for its rolling mills, senior officials said.

The construction of the new plant, BSRM Iron & Steel Company Ltd (BISCO), claimed to be the largest billet-manufacturing unit, is progressing fast. It is expected to start its commercial operation from August this year.

BISCO's estimated cost will be Tk 1.946 billion, of which Tk 1.362 will be provided by several financiers.

“We signed a syndicated term loan facility for the Tk 1.362 billion with 14 financial institutions on Tuesday,” said Aameir Alihussain, director of BSRM Group.

Industrial and Infrastructure Development Finance Company (IIDFC) is the lead arranger of the syndicated term loan. Representatives from the participating banks and BSRM signed the loan agreements.

Alihussain Akberali, chairman of BISCO, M Matiul Islam, chairman of IIDFC, Asaduzzaman Khan, managing director, SA Farooqui, managing director of Standard Bank, Erfanuddin Ahmed, president and managing director of Bank Asia, M Shahidul Islam, deputy managing director of United Commercial Bank, Rakibur Rahman, president of Dhaka Stock Exchange, and AB Siddique, CEO of Chittagong Stock Exchange, were present at the signing ceremony.

“The production capacity of the new plant will be around 1.50 lakh tonnes billet per year. The full output of the plant will be consumed by BSRM Steels Limited, an entity of our group,” Aameir Alihussain said, revealing another plan to set up a 1.50 tonne capacity billet making plant after setting up the ongoing plant.

The BSRM Group set up a captive billet making plant in 1996.

The Daily Star

Economists oppose financial stimulus

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The eight-point charter of demands, raised by the top apparel sector trade body as stimulus package, appears to ‘demonstration effect’ of the Western approach to addressing the financial meltdown, devoid of prudent exercise in Bangladesh context.
Saying so, the country’s economists have generally opposed any financial package bearing chance of abuse, cautioned the government about any whimsical formula to support only one sector and recommended fiscal measures under a holistic package to deal with negative effects of current global recession on various industrial sectors.
Bangladesh Garment Manufacturers and Exporters Association on Monday put forward the eight-point stimulus package for export-oriented apparel sector, containing cash incentives, special exchange rates, less than 7 per cent interest rate, extension of long-term loan repayment schedule, removing value added tax, subsidised diesel for generators, 12 captive power plants and rationing system for garment workers.
When their comments on such package were sought, the economists further suggested measures for protecting the country’s remittances earning and creation of higher domestic demand through massive development works and employment generation not only to save the losers of overseas jobs but also keep the domestic economy as a whole vibrant.
‘Their demands are presumably the demonstration effects of the bailout and stimulus packages offered in Europe and America, which are being criticised though. The BGMEA leaders are artificially magnifying the crisis effects on Bangladesh,’ Anu Muhammad, economics professor of Jahangirnagar University, told New Age. He felt that the BGMEA as a strong lobby was trying to take advantage of the situation.
In a similar vein, Anannya Raihan, executive director of research organisation D-Net, said the apparel sector had in the past manage to reduce duties on the plea of decline in the businesses and exports. ‘We have seen BGMEA since 1995 engaged in panic mongering as they are doing now. Global recession has become an opportunity for them to demand something,’ he added.
Both economists Atiur Rahman and Mustafizur Rahman suggested measures such as fund for providing the investors loans at lower interest rates and also persuading the banks to fund specialised sectors in a manner that they could easily face the global recession.
‘Before announcing any package the government should undertake immediate but in-depth study. We should focus more on institutional approach instead of distributing lump sum to deal with the situation,’ said Atiur Rahman, chairman of research organisation Shamunnoy
He mentioned that the government should immediately send a special envoy to countries like Malaysia to lobby for assured employment of Bangladeshi workers there.
Rahman, executive director of Centre for Policy Dialogue, proposed ‘focussed fund’ for the affected expatriate workers, skill development scheme for outgoing workers and implementation of development projects to keep domestic job market vibrant.
He pointed out that the government would have to fix its priorities to achieve the goals of overcoming the global situation with local solutions. ‘The government can give incentive to those garment manufacturers would be able to export to new market destinations,’ said Mustafiz suggesting that reduced interests rate might also be made applicable for expansion of industrial units and import of machinery.
‘Bangladesh’s apparel industry, in three decades of its history, has hardly faced such a severe challenge,’ the BGMEA president, Abdus Salam Murshedy, said at a press briefing on Monday, seeking the stimulus package. Also, Annisul Huq, president of Federation of Bangladesh Chambers of Commerce and Industry, demanded Tk 6,000 crore for the export sectors to help them overcome the possible impacts of the global recession.
Anannya Raihan rejected the apprehensions of drastic decline in export order of readymade garments, citing the trends of placing orders for the next fall [September-October] and onward. ‘There is no possibility of fall in export demand of Bangladeshi garments at that point in tine although price may fall,’ he said.
‘I think, the government should take multi-prong approach to encourage all domestic industries, seek new market destinations like Latin America and activate Bangladeshi missions abroad to work for both exports and remittances,’ said Anu Muhammad.
Meanwhile, senior economist and former finance adviser Wahiduddin Mahmud told newsmen after a meeting with the finance minister, AMA Muhith, that the government should take budgetary measures to keep incentives to the export sector.


What economists say
‘We should focus more on institutional approach instead of distributing lump sum to deal with a situation.’ – Atiur Rahman
‘The government can give incentive to those garment manufacturers would be able to export to new market destinations.’ – Mustafizur Rahman
‘The BGMEA leaders are artificially magnifying the crisis effects on Bangladesh’ – Anu Muhammad
‘We have seen BGMEA since 1995 engaged in panic mongering as they are doing now. Global recession has become an opportunity for them to demand something’. – Anannya Raihan

The New Age

Growth hinges on GP listing

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As the Grameenphone initial public offering (IPO) prospectus awaits the green light from the Securities and Exchange Commission (SEC), its success will dictate the path to market growth.

Its triumphant floatation will not only attract others to be listed on the stock market, but also help the market draw foreign or portfolio investment into Bangladesh.

“Failure of the Grameenphone listing will have devastating effects and it will dampen market interests in the long run,” Faruq Ahmad Siddiqi says in an interview with The Daily Star.

“Furthermore, new companies, including multinationals, will hesitate to come in the market,” the immediate past chairman of the SEC points out. Several big companies are anxiously waiting to see the outcome of the Grameenphone listing, he says.

People close to the Grameenphone IPO move said Bangladesh's largest mobile phone operator has fulfilled all the requirements by the market regulator regarding the $65 million, or Tk 449 crore worth IPO in the last week of February this year.

Successful floatation of the Grameenphone shares will be a pivotal catalyst in the development of the Bangladesh stock market, he believes.

Career bureaucrat Siddiqi completes his three-year tenure as SEC chief on March 12. He joined the SEC as chairman on March 16, 2006.

Siddiqi says, instead of forcing or pressuring companies including multinationals to be listed on the stock exchanges, they should be encouraged to come in the market. “The environment prevailing in the market should be such that it lures multinationals and other big players into the market."

Listing of multinationals will enhance the supply side of the market and attract foreign direct investment, he observes.

“The government should immediately offload the stakes that it holds in different companies, including the foreign ones. The new government should pay more attention to this area, in the interest of the market,” he suggests.

In his three-year tenure, the Bangladesh stock market witnessed robust growth with volatility and manipulation efforts in some cases.

“The figures speak for themselves,” says Siddiqi, also a former secretary.

When he took up responsibility in 2006, the market capitalisation was only Tk 22,670.67 crore, turnover was Tk 15.44 crore, DSE General Index was at 1,555.82 points and the volume was 33,82,959.

On the contrary, on his last working day on March 12, 2009, market capitalisation stood at Tk 1,02,246.75 crore, turnover reached an all time high at Tk 611.98 crore, DSE General Index stood at 2,653.11 points and volume was 3,75,41,462.

What are the factors that contributed to such tremendous growth?

“There was a need for an environment that facilitated trade and commerce. We tried to create such an environment, especially through regular awareness programmes in association with the Dhaka and Chittagong bourses and other market stakeholders, all within the limited resources. And we succeeded,” Siddiqi recalls.

He says the public awareness programmes and the SEC's role as a facilitator, not as a regulator, helped the general investors regain confidence, which was shattered after the 1996's bubble and burst.

“The entry of new companies and fresh investors, expansion of brokerage activities across the country, issuance of rights and bonus shares as dividend by the existing companies, increasing investor confidence and an inflow of fresh liquidity also helped the market reach today's position,” he says.

Apart from rapid growth, he says, there were some problems such as volatility, manipulation, and liquidity gluts and crunches.

“A lack of appropriate manpower within the SEC is a major problem,” he says.

Referring to the resignation of several senior officials from the SEC, he says the existing pay scale could not suffice or attract professionals to work for the SEC.

He says the SEC is in need of professional people who can analyse the quality of financial disclosures, public issues, and monitor the market stakeholders and credit rating agencies.

“The commission has no people qualified enough to monitor the credit rating agencies. There are only two people in the surveillance department, which is an important, tough and demanding section,” he cites.

In order to build capacity of the market regulator by attracting skilled personnel, he recommends: “The SEC and other similar organisations should be kept outside the national pay scale.”

Siddiqi considers two issues as major achievements during his tenure. The first, forming guidelines for margin loans provided by merchant banks to their clients, and the second, book building for IPO pricing.

“Prior to the guideline, merchant bankers provided margin loans indiscriminately. The guideline helps the market stabilise,” he says.

The introduction of book building, a modern mechanism for IPO pricing, will encourage big and established companies, from both home and abroad, to be listed on the stock exchanges, as the book building method ensures a fair price of a company's stocks, he adds.

Commenting on the Dhaka Stock Exchange's recent move against listing securities with a face value of Tk 1, he says, “The DSE cannot take such a decision. The DSE may recommend or request the SEC to take steps to forbid the listing of securities with a face value of Tk 1.”

He, however, welcomes the DSE move on de-listing the Z category companies, which are not in operation or production or an existing status. “But such companies should be carefully identified,” he suggests.

In his concluding remarks, Siddiqi says the Bangladesh stock market has an opportunity to grow in the coming years.


Former SEC boss says in an interview with The Daily Star

Repo rate cut may narrow spread

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The interest rate spread (IRS) is likely to shrink further with the central bank's latest move to cut the repo rate it charges on loans to commercial banks by 25 basis points.

IRS is the difference between lending and deposit rates of a bank and is widely used as a parameter of bank profitability, intermediation cost, and the degree of efficiency of the banking sector.

The spread declined by 1.6 percentage points to 5.17 percent between 2001 and 2008, according to Bangladesh Bank (BB) data.

The IRS was almost 6 percent in 2007 and the BB has long been asking the commercial banks to bring the IRS down within 5 percent.

Between 2001 and 2008, banks' average lending rate decreased by 1.4 percentage points, while deposit rate increased by 0.1 percentage points.

“The IRS has declined significantly because of persistent efforts of BB to encourage the banks to bring it down at a reasonable level to facilitate investment and growth,” a senior BB official told The Daily Star.

“We hope the spread will decline further because the BB reduced the banks' borrowing cost (repo rate) by 25 basis points to 8.50 percent last week,” he said.

The country's banking structure is segmented with state-owned commercial banks (SCB) and private commercial banks (PCB) holding 33.1 percent and 51.4 percent of total assets respectively. Some nine foreign commercial banks are also in operation.

Earlier, Bangladesh was branded as a high interest rate country compared to even its neighbours. But the situation changed significantly in the recent years. Now only India has a lower IRS than Bangladesh.

BB data show the IRS in India is at 3.50-4.00 percent, while it is 7.49 percent in Pakistan and 7.57 percent in Sri Lanka.

Of the IRS of different groups of banks, foreign commercial banks (FCB) have the highest spread with almost 9.0 percent. It is less than 5 percent for PCB and SCB, and 3 percent for specialised banks, data available in the BB's statistics division shows.

BB analysis revealed that within the structure, high IRS resulted from a number of factors including state control of lending, absence of risk management practices, accumulation of bad loans due to political interference on commercial lending decisions, and limited technical skills particularly in the arena of risk management.

SHAJJADUR RAHAMAN-THE DAILY STAR

Wednesday, March 18, 2009

Aftab Automobiles, Eastern Housing under scrutiny

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The Dhaka Stock Exchange Tuesday suspended the trading of the shares of Aftab Automobiles and Eastern Housing, two ‘A’ category companies, to conduct enquiries into the unusual rise in their share prices in recent times, said bourse officials.
‘The bourse will keep the trading of the shares of the companies halted until the investigations were completed,’ said DSE chief executive officer AFM Shariful Islam.
He said the bourse also observing closely the price movements of other securities.
On Tuesday, share price of Aftab Automobiles gained 11.36 per cent to close at Tk 1,231.75.
Share price of Eastern Housing gained 7.31 per cent to close at Tk 495.25. Face value of each share of the companies is Tk 100.
Earlier, on February 24, the Securities and Exchange Commission formed an enquiry committee to probe into recent unusual trading and price hike of shares of Aftab Automobiles at the stock exchanges.
The two-member committee was asked to submit its report within 30 working days.
‘We are conducting the probe,’ an SEC official, who is also a member of the investigation team, told on Tuesday. ‘The probe team is investigating into the suspected insider trading by the sponsors/directors of the company,’ he added.
Share price of Aftab Automobiles jumped to Tk 895 on February 24 from Tk 442.25 on January 25 against the face value of Tk 100, according to DSE statistics. The share price of the company started surging from mid January when it was traded at around Tk 345.
Share price of Eastern Housing surged to Tk 495.25 on March 17 from Tk 324.25 on March 3.
Earlier, the DSE suspended trading of the shares of Rahima Food, Mona Food, Bionic Sea Food, Quasem Silk, M Hossain Garments Washing and Dying, Bangladesh Electricity Meter Company, Dynamic Textile Industries, Saleh Carpet Mills and Amam Sea Food, low-profile ‘Z’ category companies, and is conducting enquiries into the unusual rise in their share prices.
Eight companies out of the nine were served with show-cause notices on Monday as the company, according to the bourse, violated the securities-related laws. The DSE served show-cause notice to Rahima Food on March 11 in this connection.
The bourse asked the companies to show causes why the bourse would not take appropriate action against them.

The New Age

Prime Finance Mutual Fund rockets on debut trading

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Capital market fair begins tomorrow

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IFC to provide $15m to PRAN Group for three-yr project

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The International Finance Corporation (IFC), a member of the World Bank group, will provide finance worth $15 million to local agro processing company PRAN Group for a three-year project ending in 2011.

This was disclosed by Pran Group at a press conference held at the National Press Club in the city Tuesday.

Major General Amjad Khan Chowdhury (Retd), chief executive of PRAN Group, Uzma Chowdhury, director of PRAN Group, Eleash Mridha, executive director of PRAN Group, Per Kjellerhaug, regional manager for IFC-Bangladesh, Bhutan, Maldives, Nepal and Sri Lanka, and Mrinal Kanti Sircar, programme manager of IFC, were present, among others, at the press conference.

PRAN officials said through this financing, it is for the first time the IFC has entered into any agro-business sector of Bangladesh.

The loan will support PRAN Group's strategic investment plan over the next three years, in six food categories such as snacks, confectionery, juice, beverage, culinary products, dairy and premium rice. This will help the company become more efficient and competitive in domestic and foreign markets, PRAN officials claimed at the news conference.

"PRAN Group aims to make high-quality, low-cost, processed and packaged food readily available to the lower- and middle-income population of Bangladesh and other countries it serves, said Maj Gen Amjad Khan Chowdhury (Retd)."

He also said with IFC as a partner, his company will continue to seek the highest standards in operations, and these efforts will boost Bangladesh's entire agribusiness sector.

"One of IFC's main priorities in the region is to support local companies in priority sectors such as food processing, particularly those with significant benefits to local suppliers and employment," said Per Kjellerhaug.

Oscar Chemerinski, IFC director for Global Agribusiness, in a separate statement, said "IFC is proud to be making its first investment in the critically important agribusiness sector in Bangladesh. We are excited to support a highly regarded company like PRAN Group to further serve the local market and expand in the global arena."

The Financial express

State banks better off :Loan recovery from top 20 defaulters at 50p

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Four state-owned banks performed better than before by realising around 50 percent of their default loans from top 20 defaulters and pulled off 94 percent of their targets from other defaulters in 2008, according to a central bank review released yesterday.

The four state banks had the target of realising Tk194 crore from top 20 loan defaulters last year but they could realise Tk98 crore, while the banks' target from other defaulters was Tk1,039 crore but they could realise Tk980 crore.

The Bangladesh Bank (BB) not only evaluated their cash recovery, it also reviewed their achievements in operating expenses, costs of deposit, manpower rationalisation, and reducing classified loans against the target fixed for them in 2008.

BB officials said the banks succeeded in reaching the targets in some areas but failed in others.

Sonali Bank had the target of retrieving Tk100 crore from top 20 defaulters but could realise only around Tk21 crore, while its cash recovery target from other defaulters was Tk484 crore but its realisation was Tk474 crore or 98 percent of the target.

In 2008 the bank's target of reducing operating costs over 2007 was 5 percent, but instead the expenditure increased by 20 percent to Tk649 crore.

Also the cost of deposit of the bank went up from 4.80 percent in 2007 to 5.04 percent in 2008.

Classified loan decreased by percentage but increased by gross amount from Tk6,859 crore in 2007 to Tk7,217 crore in 2008. However the growth in percentage went down by 2.08 percentage points to stand at 33.28 percent last year.

The bank reduced the number of cases with Artha Rin Adalat (loan court) from 7,141 in 2007 to 5,727 in 2008, and also cut manpower by 1,994 and the total number of staff stood at 20,548 in 2008. The BB said all these were positive signs.

Janata Bank though could not achieve success in realising loans from the top 20 defaulters, it exceeded the target in retrieving loans from other defaulters. Its target of realisation from top 20 was Tk30.25 crore, but the recovery was Tk20.17 crore or 66 percent of its target.

The bank's recovery target from other defaulters was Tk181.504 crore, but the realistaion was Tk258.54 crore or 142 percent of the target. It also succeeded in lowering the costs of deposit and the number of manpower. Cost of deposit was 4.79 percent in 2007 that came down to 4.53 percent in 2008.

The bank failed to reduce its operating expenses against its target of 5 percent as the expenditure increased around 15 percent to stand at Tk461 crore in 2008.

However its number of cases with the loan court decreased but the amount against the cases increased compared to December 2007. The number of cases dropped from 5,728 in 2007 to 4,720 in 2008, but the amount went up from Tk2,725 crore to Tk2,755 crore.

Agrani Bank though succeeded in realising loans from top 20 defaulters, it failed to reach the target for other defaulters. Its recovery target from the top 20 was Tk21.78 crore but the realisation was Tk37.34 crore or 171 percent of the target. However its target from other defaulters was Tk302 crore but it recovered Tk209 crore or 69 percent of the target.

The bank could lower its cost of deposit from 3.74 percent in 2007 to 3.44 percent in 2008. It reduced manpower by 357 and its total staff stood at 2,988 in 2008. However it failed to cut operating expenses that rose by 14 percent to Tk343 crore.

Its classified loan was Tk3,178 crore or 28 percent of its outstanding loan in 2007, which came down to Tk2,548 crore or 24 percent in 2008.

The bank's number of cases with the loan court remained almost unchanged at 7,462 in 2008. But the amount against the cases increased from Tk3,166 crore in 2007 to Tk3,630 crore in 2008.

Rupali Bank failed to reach its recovery target from all the defaulters.

The bank's target from the top 20 defaulters was around Tk42 crore but the recovery was around Tk20 crore. From other defaulters its loan recovery target was Tk72 crore, whereas it retrieved around Tk38 crore in 2008.


The Daily Star

Tuesday, March 17, 2009

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