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Bangladesh will show real 19bn$ foreign reserve now after IMF force to do so

Imran Khan

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Explainer: How Bangladesh will calculate reserves from June​


Explainer: How Bangladesh will calculate reserves from June




The Bangladesh Bank will disclose its new reserve position per the IMF formula in June.
The IMF set the floor on net reserves at $24.46 billion for June when the lender will conduct the first review of the performance criteria of the central bank.
The net reserve will have to be calculated according to the new formula prescribed by the IMF. According to the central bank data, Bangladesh will show a $19 billion-plus net reserve if the new formula is applied.


This net reserve amount is readily available for intervention in the foreign exchange market.
The Bangladesh Bank has a gross reserve of $31.28 billion as of 16 March. But this figure is not acceptable to the IMF as the lender says some components must be excluded from the gross reserve.


As per the IMF formula based on the Balance of Payments and International Investment Position Manual, the Bangladesh Bank will have to exclude foreign currency loans to local banks, known as the Export Development Fund (EDF), which is now $5.5 billion, deposits with state-owned local banks, deposits with the IDB Group, fixed-income securities below investment grade, a loan to Sri Lanka and other foreign currency assets in non-convertible currencies, which total $2 billion of the gross reserve.

The IMF says the central bank must also exclude the reserve-related liabilities to estimate the net reserve. Bangladesh's current reserve-related liabilities amount to $4 billion. The net reserve will be $19 billion-plus if this amount is excluded.

The IMF introduced the BPM6 manual in reporting the reserve and balance of payment in 2012 under its Safeguards Assessments agreement, which applies to all members of the Fund.

Introduced in 2000, the Safeguards Assessments are diagnostic reviews covering five key areas of control and governance within central banks, including the external audit mechanism, legal structure and autonomy, the financial reporting framework, internal audit mechanism and the internal controls system.
The IMF conducts its Safeguards Assessments mission every 12 years, as the policy's main objective is to mitigate the risks of resource misuse and data misreport.

Following the launch of BPM6 in 2012, the Bangladesh Bank adopted it for the balance of payment reporting but ignored the latest manual for reserve calculation. At that time, Atiur Rahman was the governor.
Therefore, the banking regulator continued forex reporting per the BPM5 manual, which helped the central bank management show higher forex reserves, prompting the government to use it for different infrastructural projects.



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mb444

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Explainer: How Bangladesh will calculate reserves from June​


Explainer: How Bangladesh will calculate reserves from June




The Bangladesh Bank will disclose its new reserve position per the IMF formula in June.
The IMF set the floor on net reserves at $24.46 billion for June when the lender will conduct the first review of the performance criteria of the central bank.
The net reserve will have to be calculated according to the new formula prescribed by the IMF. According to the central bank data, Bangladesh will show a $19 billion-plus net reserve if the new formula is applied.


This net reserve amount is readily available for intervention in the foreign exchange market.
The Bangladesh Bank has a gross reserve of $31.28 billion as of 16 March. But this figure is not acceptable to the IMF as the lender says some components must be excluded from the gross reserve.


As per the IMF formula based on the Balance of Payments and International Investment Position Manual, the Bangladesh Bank will have to exclude foreign currency loans to local banks, known as the Export Development Fund (EDF), which is now $5.5 billion, deposits with state-owned local banks, deposits with the IDB Group, fixed-income securities below investment grade, a loan to Sri Lanka and other foreign currency assets in non-convertible currencies, which total $2 billion of the gross reserve.

The IMF says the central bank must also exclude the reserve-related liabilities to estimate the net reserve. Bangladesh's current reserve-related liabilities amount to $4 billion. The net reserve will be $19 billion-plus if this amount is excluded.

The IMF introduced the BPM6 manual in reporting the reserve and balance of payment in 2012 under its Safeguards Assessments agreement, which applies to all members of the Fund.

Introduced in 2000, the Safeguards Assessments are diagnostic reviews covering five key areas of control and governance within central banks, including the external audit mechanism, legal structure and autonomy, the financial reporting framework, internal audit mechanism and the internal controls system.
The IMF conducts its Safeguards Assessments mission every 12 years, as the policy's main objective is to mitigate the risks of resource misuse and data misreport.

Following the launch of BPM6 in 2012, the Bangladesh Bank adopted it for the balance of payment reporting but ignored the latest manual for reserve calculation. At that time, Atiur Rahman was the governor.
Therefore, the banking regulator continued forex reporting per the BPM5 manual, which helped the central bank management show higher forex reserves, prompting the government to use it for different infrastructural projects.



Top News

IMF / Bangladesh Bank / Bangladesh Bank Reserve


Still several times more than pakistan in clear liquidity and IMF released funds on demand?

What about pakistan, your begging and pleading making any headway with IMF?
 

sonargon

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I'm glad for this. I can't believe it takes initiative from a western organization to get our people to act with some level of integrity. And yet people from this part of the world want to think that somehow they are superior in values to the west. Its all just cope.

In the past we looked to the noble Sufi saints to bring reform to our society and thinking. Today we look to the capitalistic IMF. How embarrassing.
 

Tom-tom

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If new formula applied then mighty Pakistan and elites rulers that are infallible, also untouchable due martial race and caste based system, in the only true Islamic nation on earth. There fore the true guardians of Islam.

Hence therefore Pakistan reserves must be found in sea bed.
 

mb444

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Seems Bengalis too have an Ishaq Dar running their finance ministry?


No BD has mature economic policy.

The issue here is the calculation of total reserves and net liquidity. BD calculates and claims reserves to be as per total reserves. This was the international standard. It includes liquid capital but also loans to local entities for imports and deposits in institutions like IMF. The latter two are not immediately liquid cash but can be converted back in medium term, but new calculation excludes this. Lastly IMF wants all payment falling due in the next 2 years to be exluded. In case of BD it is $4b.

So reserves quoted now is absolute liquidity of BD after all liabilities have been taken care off.

As a net importing nation the gap between import and Export+remittance traditionally had been $1-$2b. But drastic action has been taken by BB for the last 6-8 months to turn this into net exporting scenario.

In Jan 2023 export+remittance was $7b vs Import payment of $5.4b. A surplus of $1.6b.

Between July 2022 to Jan 2023 the gap between import vs Export+remittances was $1.9b compared to previous year in the same timeframe where the deficit was $5b.

BD took action timely, we will pass through this difficult phase.

Just for reference for pakistan your reserves are now $0.00 using the same calculation. You have about $8.5b. Some of its just other countries leaving their money in your bank account and you can not use it. But most critically you have $8.3b of debt servicing due by the end of March.

As per your own defense minister PK is bankrupt and already in default.


So when you go to begging IMFbailout they told you first stop lying and show your real auqat 19bn$.lolllz


They simply said update calculation to latest IMF standard from the previous IMF standard that BD was using. No one was lying, the breakdown of the reserves always gave the liquid position.


And IMF was so bothered by it all that they immediately released the money....LOL. You wish you could be in that situation....


Where are your malls and roads and getting you. Why is IMF not impressed? Why can the martial race not secure paltry $1.5b? Looking in the mirror must really hurt.
 
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Imran Khan

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If new formula applied then mighty Pakistan and elites rulers that are infallible, also untouchable due martial race and caste based system, in the only true Islamic nation on earth. There fore the true guardians of Islam.

Hence therefore Pakistan reserves must be found in sea bed.
You are plain stupid

Pakistan did not count our 65 tons gold in reserves .

Its BD whom faking numbers by counting investment loans everything in reserves .stop lying to world everything will be fine .
 

epebble

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Pakistan did not count our 65 tons gold in reserves .
An interesting question is, will SBP liquidate these reserves before defaulting or default while preserving the reserves, if and when it comes to it? The costs of default are higher than loss of gold reserves, but the psychology of gold is such that SBP may default first instead of liquidating its reserves. BTW, though it is a lot of gold, it is only $4 Billion. Not a lot for a country of Pakistan's size.
 

mb444

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You are plain stupid

Pakistan did not count our 65 tons gold in reserves .

Its BD whom faking numbers by counting investment loans everything in reserves .stop lying to world everything will be fine .


Only one stupid is you.

Here some numbers over the last year..... BD loses 25% of its reserves where PK loses 50% of its. In the same timeframe your rich nation had only half our reserves.

BANGLADESH


Screenshot_20230326-184406_Chrome.jpg


Pakistan


Screenshot_20230326-184605_Chrome.jpg
 

Genghis khan1

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Still several times more than pakistan in clear liquidity and IMF released funds on demand?

What about pakistan, your begging and pleading making any headway with IMF?
Year ago Pakistan was near $30 Billion. More than your several times higher. Your several times higher will go poof in matter of months.
 

Imran Khan

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Only one stupid is you.

Here some numbers over the last year..... BD loses 25% of its reserves where PK loses 50% of its. In the same timeframe your rich nation had only half our reserves.

BANGLADESH


View attachment 922242

Pakistan


View attachment 922243
Thread have nothing to do with pakistan idiot

An interesting question is, will SBP liquidate these reserves before defaulting or default while preserving the reserves, if and when it comes to it? The costs of default are higher than loss of gold reserves, but the psychology of gold is such that SBP may default first instead of liquidating its reserves. BTW, though it is a lot of gold, it is only $4 Billion. Not a lot for a country of Pakistan's size.
Talk about BD 19bn$ now dont run offtopic
 

Genghis khan1

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If new formula applied then mighty Pakistan and elites rulers that are infallible, also untouchable due martial race and caste based system, in the only true Islamic nation on earth. There fore the true guardians of Islam.

Hence therefore Pakistan reserves must be found in sea bed.
What makes you think IMF is using old formula for Pakistan and new for BD? You level of common sense must also be on the sea bed.
 

Imran Khan

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What makes you think IMF is using old formula for Pakistan and new for BD? You level of common sense must also be on the sea bed.
Its very simple .BD was cheating in numbers of data .while pakistan was not .

BD was including investments in FR
BD was including loans given in FR
BD was including sov wealth fund also in FR

So number look bigger as they cheat in gdp . Now IMF told them show only liquid reserves you have .do not play drama .so they have 19bn$ liquid reserves .that is why BD was looking for bailout from IMF .


Its plain simple if someone is not blind .
 

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