The Bangladesh Bank has now collected Tk6,500 crore from banks against government treasury bills at a time when the banking sector is going through a liquidity crunch.
Even a few days ago, to ease the crisis, the central bank suspended mopping up money from the market through Bangladesh Bank bills for a month starting from 1 December.
According to the central bank's auction calendar, the government on Sunday was supposed to raise Tk2,500 crore through two categories of treasury bills based on their maturity – Tk1,500 core against the 91-day bill at 2.4% interest and Tk1,000 crore against the 364-day one at 3.49%.
However, the central bank collected Tk3,841 crore and Tk2,840 crore respectively through the bills to meet a rising demand for bill payments all of a sudden.
Talking about this, a Bangladesh Bank official said when the auction calendar was prepared, the government had a surplus fund. But its account has now turned almost negative following the payments of large bills in the last one week. That is why the central bank had to raise this big amount.
The government will have to make some more payments in the next few days. At the same time, it also needs to pay a few bills at the beginning of the New Year, he noted.
In November, the central bank absorbed around Tk2,000 crore in excess liquidity from the banking system through an auction of Bangladesh Bank bills. Besides, in August-November, it sold Tk16,000 crore worth of dollars to banks to halt the depreciation of taka and meet the growing economic demand.
The ongoing liquidity crunch also compelled the central bank to stop issuing Bangladesh Bank bills for a month starting from last Wednesday.
Expressing concern over the sudden withdrawal of a huge amount beyond the target of the auction calendar, a state-owned bank official said, "The central bank should have informed us about this beforehand so that we could prepare for it."
He further alleged that despite the Bangladesh Bank's directive that the interest rate of term deposits must not be less than that of inflation, the bank itself is paying less than 4% interest on three-month treasury bills, which needs to be further enhanced.
The central bank uses various monetary instruments to drain surplus liquidity from the market to keep inflation in check. Usually, money is mopped up from the market through Bangladesh Bank bills, increasing the cash deposit rate against bank deposits, etc.