News & Events

Review Workshop on Trade Services of Banks held in BIBM

Press Release
Dhaka,24 April 2018
A day long Review workshop was held at the Bangladesh Institute of Bank Management (BIBM) on 24 April 2018, in its auditorium. The Workshop was organized simultaneously at BIBM auditorium in Dhaka and  Bangladesh Bank Chattogram office (through video conferencing). A paper titled " Trade Services Operations of Banks " was presented in the workshop by Dr. Shah Md. Ahsan Habib, Professor & Director (Training) of BIBM. Other members of the research workshop team are Antara Zareen, Asistant Professor, BIBM; Tofayel Ahmed,Lecturer, BIBM; Mohammad Anisur Rahman, Joint Director, Bangladesh Bank; Kamal Hossain, Joint Director, Bangladesh Bank; Mahmudur Rahman, Senior Vice President, Islami Bank Bangladesh Limited; Shuvra Kanti Saha, Senior Vice President, Eastern Bank Limited and A.T.M. Nesarul Hoque, Vice President,Mutual Trust Bank Limited.
The study identifies the problem areas as well as success factors in Trade Services Operations of Banks in Bangladesh. A good number of participant’s senior bank executives, academicians, media representatives, faculty members, officers of BIBM participated in the review workshop. BIBM Director General Toufic Ahmad Choudhury Chaired the Program.
Mr. Abu Hena Mohd. Razee Hassan, Chairman, Executive Committee, BIBM and Deputy Governor, Bangladesh Bank was present in the review workshop as the chief guest. Mohd. Humayun Kabir, Executive Director, Bangladesh Bank; BIBM Chair professor Muzaffer Ahmed, Former Dhaka University Economics department professor Barkat-e-Khuda, BIBM supernumerary professors Md Yasin Ali and Helal Ahmed Chowdhury spoke among others at the workshop.
Deputy Governor Abu Hena Mohd. Razee Hassan said, the volumes of export proceeds have decreased in last quarter of 2017 but import payments increased in 2017. According to review paper in regard to the facilitation of the trade process, contribution of the private commercial banks (PCBs) was the most during the calendar years from 2011 to 2017.  
He said, trade services in the export processing zones (EPZs) are dominated by the offshore banking units of FCBs. Like payment flows, volume of trade finance of the banking sector increased over the years. The study shows, in 2017, PCBs were the major contributors in export finance market in Bangladesh and the contribution of SCBs increased in FY 2017.  
According to survey by the Bangladesh Institute of Bank Management,Trade-based money laundering is a growing concern for the banking industry amid rapid expansion of foreign trade. Bangladesh's external trade stood at about $80 billion in 2016-17 and it has been growing thanks to the steady economic growth over the past decade, it said.
Among the trade-based money laundering techniques, over- and under-invoicing of goods and services and misdeclaration of goods are commonly used in Bangladesh, the survey on trade services operations of banks found. Money laundering is facilitated by collusion between importers and exporters and bank officials are sometimes forced to get involved in the illegal transactions, it said.
A lack of proper price assessment is responsible for money laundering through foreign trade activities, said Helal Ahmed Chowdhury, supernumerary professor of BIBM.
Moinul Khan, commissioner of Customs Valuation and Internal Audit Commissionerate said, misdeclaration of pricing of the imported and exported products is a great concern for trade-based money laundering. There is a minimum price limit for products but no maximum limit. As a result, fraudsters can easily launder money.Of the total laundered amount, 80 percent are done through trade activities.A systemic audit from both customs and banks can play a role in prevention of trade-based money laundering, he said.
Financial crime is growing in the foreign exchange market along with increasing international trade, said Mohd Humayun Kabir, executive director of Bangladesh Bank.Bank officials will have to be trained to fight the challenge of money laundering, he added.
Shah Md Ahsan Habib, professor and director of BIBM, presented the findings of the survey. He said,Money has been laundered by using four techniques — over and under invoicing, multidimensional invoicing, fake declaration, and under and over shipment.
BIBM supernumerary professor Yeasin Ali mentioned that it was matter of concern that 80 per cent of international trade occurred through private banks. Stating about the bank owners’ pressure on the government over different issues, Yeasin questioned whether there was any such initiative of them to recover bad loans.


Written by Manager

Wednesday 25th April 2018