The Bangladesh Bank (BB) has approved conversion of the state-run Probashi Kallyan Bank (PKB), a specialised financial institution, into a scheduled bank to expand its business further, officials said.
The decision was taken at a meeting of the BB board of directors, held at its headquarters in the capital on Sunday, with BB Governor Fazle Kabir in the chair.
According to the decision, the central bank's department concerned will issue a notification, mentioning PKB as a scheduled bank, after completing all the formalities, they added.
The meeting also discussed different issues about the next monetary policy that is scheduled to be released by the last week of this month, according to the officials.
When contacted with a BB senior official after the meeting, he said the BB board has approved in principle the conversion of PKB into a scheduled bank.
He also said the Banking Regulation and Policy Department of the central bank will issue a notification in this connection.
The BB's decision came after the Ministry of Finance (MoF) had given its consent in favour of allowing the migrants' welfare fund to hold a 95 per cent stake in the specialised PKB.
"As per the Section 121 of Bank Company Act 1991, PKB can be exempted from the Subsection 14 ka (1) in holding a 95 per cent stake (Tk 3.80 billion) by the Wage Earners' Welfare Board (WEWB)," the ministry said in its letter.
Besides, PKB had received Tk 200 million from MoF to replenish its paid-up capital to Tk 4.0 billion.
"We've planned to start receiving remittance from migrant workers after getting permission from the BB (to operate) as a scheduled bank," PKB general manager Safiar Rahman told the FE.
PKB will also expand its business to finance projects in different productive sectors, including agriculture and small and medium enterprises (SME), he added.
PKB started its operation in April 2011 with a capital of Tk 1.0 billion to provide collateral-free loans to overseas jobseekers as well as to give loans for rehabilitation of expatriate workers on their return home to engage them in various income-generating activities.
Currently, PKB is running its business with 63 branches across the country.