This time, BASIC Bank will merge with City Bank. This decision was taken in a meeting held at Bangladesh Bank on Monday. The decision was taken at a meeting held at Bangladesh Bank on Monday (April 8). The meeting was held between Bangladesh Bank Governor Abdur Rauf Talukdar and City Bank Chairman Aziz Al Kaiser along with Managing Director (MD) Mashrur Arefin. Earlier on March 19, City Bank's board was advised to merge BASIC Bank. Then the matter was discussed between the boards of City and BASIC Bank. According to some sources, even if the two banks are merged, they will report separate financials for the next three years.  

The move marks an end to Japan's famous and long-running negative interest rate policy. The Bank of Japan (BOJ) announced on Tuesday the end of its negative interest rate policy and increased borrowing costs for the first time in 17 years. The negative rates were a part of Japan's aggressive monetary easing program. "The Bank will encourage the uncollateralized overnight call rate to remain at around 0 to 0.1%," the central bank said in a statement, moving them from their previous level of negative 0.1%, thus still keeping rates stuck around zero. It was Japan's first interest rate hike since 2007 and marks an end to a prolonged period of ultra-loose monetary policy aimed at stimulating the economy. More details regarding the decision and possible further hikes would follow BOJ Governor Kazuo Ueda's press conference later on Monday.  According to the Nikkei newspaper, Japanese Prime Minister Fumio Kishida said, "We trust the BoJ," adding that the decision "is in their hands." How significant is the interest rate rise in Japan? The rate hike has a lot of "symbolic significance," Izumi Devalier, head of Japan economics at BofA Securities, said ahead of the announcement. "But the actual impact on the economy is very small." She believed that the BOJ will likely continue keeping monetary conditions loose. Raising the rate will make loans more expensive for consumers and businesses. Following the rate hike, Japanese stocks saw fluctuations on Tuesday, and the yen dropped by 0.39% to 149.74 against the dollar. Understanding BOJ's policy  While many western central banks kept interest rates at or near zero in the roughly 15 years after the financial crash of 2007 and 2008, Japan's was already moving in that direction by the mid 1990s.  This was both as part of a bid to encourage spending and inflation in an aging society with negative population growth, and also in a bid to keep the country's debt repayments manageable, with Japan the most endebted country on the planet as a share of GDP.  In recent months, for the first time in years, inflation in Japan was approaching the Bank of Japan's 2% target level, prompting speculation in recent weeks that a rates change was likely either in March or April's BOJ meeting.   

Padma Bank is going to be merged with Exim Bank. The decision was taken unanimously at a meeting of the Board of directors of Exim Bank. Bangladesh Bank has been informed about the merger of the two banks. Chairman of Exim Bank, Nazrul Islam Mazumder, confirmed the matter to the media on Thursday (March 14). Padma Bank is set to merge with Exim Bank, marking the first voluntary merger in Bangladesh's history. Padma Bank, which has long been struggling with bad loans, set to merge with Exim Bank marking the first voluntary merger in  history Bangladesh. A director of Exim Bank said, "We have decided to merge the private Padma Bank with our bank. Soon it will be sent to Bangladesh Bank for permission. It will come into effect after the approval of the regulatory body."

The financial condition of four commercial banks has become fragile. As a result, the banks had fallen into red zones. Besides, four private banks and one foreign bank are on the list. The four state-owned banks are Basic Bank, Janata Bank, Agrani Bank and Rupali Bank. Besides, there are four private banks in this zone. These are Padma Bank, Bangladesh Commerce Bank, National Bank and AB Bank. Besides, the foreign National Bank of Pakistan is in the red zone. Bangladesh Bank (BB) gave this information with a biennial report titled  "Banks Health Index and HEAT Map" prepared by the Financial Stability Department of the BB.   

During Ramadan, banking hours is reduced by 30 minutes. Bangladesh Bank said in a new directive that banking transaction will take place between 9:30 am to 2:30 pm.  Bangladesh Bank on Tuesday (March 5) has fixed office hours for banking transactions during Ramadan. According to the Bangladesh Bank, banks will remain open from 9:30 am to 4:00 pm. There will be a break for prayers from 1:15 pm to 1:30 pm in the office timing during Ramadan. However, transactions should be continued in alternative systems at this time. The usual working and transaction schedule will resume  to the previous state at the banks and financial institutions after the holy month of Ramadan.

Three people were killed in an Israeli drone strike in the occupied West Bank, the Palestinian Health Ministry said. Israeli forces said they launched the drone strike after coming under fire from a group of people during a raid in the Jenin refugee camp.  The military said "hits were identified." The Palestinian Authority's official news agency, WAFA, reported that the drone fired at least two projectiles, citing sources in the camp. According to the health ministry, more than 100 Palestinians have been killed in the occupied West Bank in clashes with Israeli forces since October 7 as the Israeli military pursues Palestinian militants in the aftermath of the Hamas terror attack from Gaza.

Israeli aircraft struck the Jenin refugee camp in the occupied West Bank early on Sunday, killing two Palestinians and wounding several others, Palestinian medics said. The Palestinian Red Crescent ambulance service said the strike hit an area near al-Ansar Mosque in Jenin refugee camp, a Palestinian militant stronghold in the territory. Jenin was the focus of major Israeli military operations earlier this year. According to Israel, "terror operatives" from Hamas and Islamic Jihad who were planning attacks were killed in an air strike. The Israeli military said al-Ansar mosque "was used by the terrorists as a command center to plan the attacks and as a base for their execution." Violence in the West Bank has flared since Hamas gunmen carried out terror attacks on Israel on October 7. Israel has since then carried out retaliatory airstrikes on Hamas in Gaza.

The Gaza Strip, a small area nestled between Israel, Egypt and the Mediterranean, is one of the most densely populated areas in the world.  The militant Islamist Palestinian group Hamas has been attacking Israel from Gaza since October 7. Germany, the European Union, the US and some Arab states classify Hamas as a terrorist organization. The Gaza Strip covers an area approximately ten kilometers wide and 41 kilometers long. Just over two million people live there, which means an average of around 5,500 people per square kilometer. In Israel, the average population density is around 400 people per square kilometer. Who lives in the Gaza Strip? The people living in the Gaza Strip are Palestinians. This includes both those who were original residents there but also many refugees who fled to Gaza from Israel following Israel's founding in 1948 and the subsequent military conflicts between Israelis and Palestinians. Most of the residents live in the north of the region, particularly in Gaza City. The population is very young, with almost 40% of the population under the age of 15. What is the difference with the West Bank? The Palestinian territories include the Gaza Strip and the Israeli-occupied West Bank. The West Bank with East Jerusalem borders Israel, the Dead Sea and Jordan. Being much larger and less densely populated, it differs significantly from the Gaza Strip. It is governed by the Fatah party, the strongest faction in the Palestine Liberation Organization (PLO), which recognizes Israel's right to exist and is seen by most Western countries as representing the Palestinians. Who governs Gaza? Since 2007, the Gaza Strip has been governed by the militant Islamist group Hamas. The group rejects the peace process with Israel and in its charter calls for the destruction of Israel. For years, militants have sent rockets from Gaza into Israeli areas, but the attack that began on October 7 is a dramatic escalation of the longstanding conflict. What is the Gaza Strip blockade? Since Hamas came to power in 2007, Gaza has been seen as "enemy territory" by Israel and has remained largely sealed off to this day. Israel controls access by land, sea and air. Hamas has since continued what it describes as "self-defense" attacks on Israel, which have resulted in four major military clashes with the Israeli army in the past: in 2008-09, 2012, 2014 and 2021. The blockade of Gaza is also largely supported by Egypt, its only other neighbor. As a result, economic isolation has led to a drastic deterioration in living conditions with large parts of the population living in poverty. Around 40% of residents between the ages of 15 and 24 are unemployed. Poverty and a lack of prospects and opportunities, particularly among the young population, helps Hamas to continue to mobilize support. How is Gaza supplied? Between Israel and Gaza, there's a border crossing for people (Erez) and one for goods (Kerem Shalom/Sufa). There is also one crossing into Egypt in Rafah. The import of goods is strictly controlled by Israel, in part to prevent arms from being moved into Gaza. The border with Egypt is also often blocked so that Hamas tries to smuggle goods in via a network of tunnels. The Gaza Strip is largely dependent on international aid; according to the UN, this affects around 80% of the population. The situation is particularly difficult for the many refugees who still live in camps and are completely dependent on aid deliveries. Gaza also suffers from regular power outages , and electricity is often only available for a few hours a day. Water is scarce and the majority of the population does not have clean drinking water. The healthcare system is also dependent on international help and, especially in times of military conflict with Israel, often overwhelmed.

The World Bank has called for an increase in tax collection from the major and vital sectors in Pakistan claiming that the tax collection is insufficient to meet its financial necessities, ARY News reported on Wednesday. ARY news reported citing the report, that the tax-to-GDP ratio of progressive countries should be at least 15 percent but Pakistan has only 11.6 percent. The World Bank has termed the tax collection in Pakistan, the lowest in the region and suggested that the tax collection is not improving in Pakistan. It also suggested that the country should increase tax collection from major sectors and eliminate income tax, sale tax, and customs duties exemptions. The World Bank has also proposed linking property tax rates to market values by connecting the land ownership record with national identity cards and national tax numbers.  Along with the recommendation to eliminate exemptions on income tax, sales tax, and customs duties, the World Bank has suggested a standard GST (General Sales Tax) rate of 18% on various goods. The report has proposed bringing individuals earning less than 600,000 rupees annually into the tax net. It also recommends imposing additional taxes on agriculture, property, real estate, retail, and the cigarette sector while reducing taxes on luxury items. According to the World Bank, Pakistan is incurring significant losses in revenue due to tax concessions. As Pakistan grapples with a severe economic crisis and soaring inflation, this financial safety net of the people of Pakistan appears eroding, Dawn reported. These savings, whether in cash or assets like gold, were traditionally reserved for significant expenses such as weddings, unexpected illnesses, or business losses but families are finding themselves compelled to dip into their savings to cover daily necessities, including electricity bills, school fees, rent, and other essential expenses, Dawn reported. Although the IMF approved a USD 3 billion bailout to support Pakistan in avoiding a default on its debt repayments, Islamabad is finding it difficult to implement all the conditions imposed by the lender.

The finance ministry on Wednesday forecast inflation to surge by 3-4 percentage points to 31 per cent in September compared to 27.4pc in the preceding month mainly because of a major increase in fuel prices. Inflation was likely to ease due to the double-digit base effect in September, but the significant rise in fuel prices offset it, said the Economic Advisors’ Wing of the Ministry of Finance in its monthly economic update & outlook for September. Together with this, the upward adjustment in energy tariffs is further likely to intensify inflationary pressures in the coming months as these price adjustments are expected to place an additional burden on transportation costs, essential items, and services, it further said. It is expected that inflation will remain in the range of 29pc to 31pc in September. Inflation has declined to 27.3pc in August, down from peak levels of 38pc in May. The State Bank of Pakistan forecasts inflation to decline sharply in 2024 due to the improved agricultural output, and administrative measures taken to curb volatility in the foreign exchange markets. SBP has projected 20-22pc average inflation for FY24 from 29.2pc in FY23. The report highlights a series of actions that the government has already taken and the declining international prices that would help to lower inflation in the coming months. The report claims that the government’s stern administrative measures to curtail the hoarding of commodities and a crackdown on illegal forex business have resulted in moderating the inflation pressure. However, given the international oil price pressure and adjustment in energy prices, uncertainty in inflation will remain. The government has launched an operation against illegal forex dealers and commodity hoarders, which has stabilised the exchange rate and reduced commodity prices. The SBP has left its policy rate unchanged at 22pc saying inflationary expectations are under control. The rupee depreciated by 45pc against the dollar since June 2022 reaching 295 in the interbank market and 304 in the open market in August. The weak rupee had fuelled the record-high inflation in the past year. To address this issue, the government has taken action against the exchange companies that were involved in speculative activities. On the other hand, international food prices have been experiencing a decline since August. The Food and Agriculture Organisation (FAO)’s price index, which tracks the most globally traded food commodities, averaged 121.4 points in August against 124.0 for the previous month. The August figure was the lowest since March 2021 and also 24pc below than an all-time high in March 2022, in the wake of Russia’s invasion of Ukraine. The decline in most of the food commodities is offsetting the increases in rice and sugar. According to the finance ministry, the main cause of inflation is the structural problems — public debt, energy circular debt and trade deficit. Corrective fiscal action must be taken on an urgent basis to reduce inflation. For FY24, significant enhancements in budget allocations for social safety nets have been made including cash transfers under BISP. The government is taking measures to curb inflation and is sparing the public from the full impact of the power and gas tariff hike. It has allocated Rs1 trillion for subsidies in FY24, the ministry said. Source: DAWN