1.

Current condition of Bangladesh economy and Banking Industry

Analysis of current monetary policy: It’s Contractionary because:

1) Global inflation (due to raise in energy price level as well as the price in rice)
2) Huge import create current account deficit more widened, which further depreciate
the local currency.
Major Decision in the policy:

 Policy interest rate remain unchanged

 Emphasis on the capital market
 Attract more foreign investment in the capital market

The central bank of Bangladesh slashed on Tuesday the cash reserve requirement
(CRR) by 1.0 percentage point to 5.50 per cent, enabling all the scheduled banks to use
Tk 101 billion worth of additional fund.

According to the latest decision, the existing repo interest rate of the central bank will
come down to 6.00 per cent from the existing level of 6.75 per cent while the reverse
repo rate will remain unchanged at 4.75 per cent.

The provisional data of the Bangladesh Bureau of Statistics (BBS) showed that the
growth rate of the country's financial intermediation is set to drop to 7.90 per cent in FY
2017-18 from that of 9.12 per cent in last fiscal.

According to the BBS provisional data, the growth rate of 'monetary intermediation
(banks)' sub-sector has dropped the highest of 1.44 percentage points to 8.51 per
cent in the current FY from that of 9.95 per cent in FY 17.

Meanwhile, the growth of the country's financial sector has declined to a single-digit
over the last five years compared to its impressive double-digit growth in FY 11 and FY
12 following several scams and troubles in banking sector.
NPL in the banks reached to Tk 743.03 billion in the calendar year 2017 from that of Tk
621.72 billion in 2016, the central bank data showed.

2. Probable strategy/priority for the stable bank like BRAC Bank, in the current
condition