Jamuna Bank, which is listed on local stock exchanges, will set up an exchange house in Spain for transferring remittances to Bangladesh through the banking channel.
To establish the exchange house, the private sector lender has already obtained approval from the Bangladesh Bank and the respective regulators of Spain.
The new exchange house will be established under the name of Jamuna Money Transfer SL with paid-up capital of 125,000 euros. It will be a full subsidiary of Jamuna Bank.
Mirza Elias Uddin Ahmed, managing director of Jamuna Bank, told The Business Standard, after the Middle East, Europe hosts the highest number of Bangladeshis.
"Remittances are increasing from there. And we are having an exchange house in Spain to send this remittance to the country through banking channels," he added.
He also said that other Bangladeshi banks have exchange houses in Europe. But most of them are in England. Some are in Italy. And Jamuna Bank is probably the first bank to set up an exchange house in Spain.
As for the reason for choosing Spain, he said, "Initially, we wanted to do it in Germany. But there are complications in meeting regulatory requirements. In that case, it is very easy to fulfil these requirements in Spain."
Moreover, if a bank has an exchange house in any European country, it can provide services to all the countries there. Spain is in an advantageous position in that regard, he added.
Mirza Elias said expatriates earlier used to send remittances through companies like Western Union or MoneyGram.
"Without bringing remittance through these institutions, now banks are interested in doing this work themselves. So many banks have applied for setting up exchange houses in Europe. Because there is good business around this remittance," he added.
According to the Refugee and Migratory Movements Research Unit, at the end of November 2021, some 4.85 lakh migrant workers went to Europe for employment.
According to the Ministry of Expatriates' Welfare and Overseas Employment, the number is currently more than 5 lakh. And the number of Bangladeshis going illegally is not small, the ministry said.
England hosts the largest number of Bangladeshis among European countries. It is followed by Italy, France and Germany.
According to sources in the Bangladesh Bank, $875.41 million in remittances came from Europe in the July-September quarter of this year, which is 20% higher than the same period of the previous year.
The total remittance received from European countries in fiscal 2021-22 was $3,176.93 million. A review of the Bangladesh Bank data shows that remittances from Europe have increased by 135% in the last five years.
According to sources, expatriates can easily send remittances through banking channels for a fixed fee or charge and receive 2.50% cash incentives against their remittances.
The earnings per share (EPS) of Jamuna Bank was Tk4.06 at the end of the January-September period of 2022, which was Tk3.87 in the same period of the previous year.
And on the Dhaka Stock Exchange (DSE), the bank's shares were traded at Tk21.30 on Monday.