BB moves to amend articles on gold coin, bullion
Thursday, 31 January 2008
FE Report
The central bank is working to amend the Bangladesh Bank Order 1972 clarifying a number of articles therein including holding gold coins and gold bullion, officials said.
The central bank has taken such a move against the backdrop of an objection raised by the audit firm in its report for the fiscal 2006-07, mentioning that 52 per cent out of the required 85 per cent gold coins and gold bullion have been shown in its balance sheet.
Under article 30 of the Bangladesh Bank Order 1972, at least 85 per cent (seventeen-twentieths) of the total gold coins and gold bullion should have been in custody of the central bank including its branches and offices of agencies, where at the balance sheet date, such gold coins and gold bullion represented 52 per cent of the total bullion, the audit report said.
The audit report was prepared by Rahman Rahman Huq and Hoda Vasi Chowdhury & Co.
"The central bank has lent its 48 per cent gold to the Bank of Novascotia, London for receiving interest on the precious metal", a BB senior official told the FE Wednesday.
As per the existing Bangladesh Bank Order, sev enteen-twentieths of the gold is required to be held in custody of the central bank. But considering the interest of the BB a portion of the gold (more than limit) has been invested in line with a decision of the investment committee of the central bank.
"Of the gold coin and gold or silver bullion held as assets not less than seventeen-twentieths shall be held in the custody of the Bank including its branches, offices of agencies, and the gold or silver belonging to the Bank which is in any other bank or in any mint or treasury or in transit may be reckoned as part of the assets," the Bangladesh Bank Order said.
The official also said a legal consultative council is now working to prepare a draft for amending the existing Bangladesh Bank Order that will be submitted to the authorities concerned for taking necessary measures.
The central bank is working to amend the Bangladesh Bank Order 1972 clarifying a number of articles therein including holding gold coins and gold bullion, officials said.
The central bank has taken such a move against the backdrop of an objection raised by the audit firm in its report for the fiscal 2006-07, mentioning that 52 per cent out of the required 85 per cent gold coins and gold bullion have been shown in its balance sheet.
Under article 30 of the Bangladesh Bank Order 1972, at least 85 per cent (seventeen-twentieths) of the total gold coins and gold bullion should have been in custody of the central bank including its branches and offices of agencies, where at the balance sheet date, such gold coins and gold bullion represented 52 per cent of the total bullion, the audit report said.
The audit report was prepared by Rahman Rahman Huq and Hoda Vasi Chowdhury & Co.
"The central bank has lent its 48 per cent gold to the Bank of Novascotia, London for receiving interest on the precious metal", a BB senior official told the FE Wednesday.
As per the existing Bangladesh Bank Order, sev enteen-twentieths of the gold is required to be held in custody of the central bank. But considering the interest of the BB a portion of the gold (more than limit) has been invested in line with a decision of the investment committee of the central bank.
"Of the gold coin and gold or silver bullion held as assets not less than seventeen-twentieths shall be held in the custody of the Bank including its branches, offices of agencies, and the gold or silver belonging to the Bank which is in any other bank or in any mint or treasury or in transit may be reckoned as part of the assets," the Bangladesh Bank Order said.
The official also said a legal consultative council is now working to prepare a draft for amending the existing Bangladesh Bank Order that will be submitted to the authorities concerned for taking necessary measures.