Govt allows state-owned cos to deposit 50pc of funds in private banks

The government has allowed state-owned companies to deposit up to 50 per cent of their surplus funds in private banks and non-bank financial institutions.

The finance ministry’s Financial Institutions Division issued a notice on Monday, saying the decision will help commercial banks lower lending rates to a single digit, reports bdnews24.com.

State-owned companies will receive a maximum interest rate of 6 per cent on deposits, according to the notice.

On the other hand, the companies will receive 5.5 per cent interest rate on deposits in state-owned banks.

The government made the decision as it aims to boost private investment and keep up the pace of economic growth, according to the statement.