Liquidity Crisis Essay

At present our commercial Bankss are go throughing a hard state of affairs. Most of the Bankss are in liquidness crisis. And this type of deficit of money makes hard to prosecute in assorted minutess. Now the chief causes behind this are given below: –

Currency value: – In the recent twelvemonth. our state has experienced a diminution in the value of Tk against currency which has created has immense liquidness crisis in the banking sector. For this ground our state has failed to roll up maximal sum of US dollar required to open missive of recognition ( LC ) for local business communities to import indispensable trade goods for the state. As a consequence the importer is confronting a terrible crisis in their concern.

Compulsory modesty: – Banks need to reserve immense sum of money to keep CRR and SLR. As it is compulsory responsibility of them. BB has late increased the rate of CRR and SLR as consequence the job of liquidness crisis has been aggravated late.

Government recognition: – To diminish the shortage budget unit govt. are taking loan from commercial Bankss. And this thing create excess load to our banking sector and it cause more liquidity crisis in that sector.

Inflation: – The liquidness crisis of the banking sector has been accelerated by the increased sum of rising prices. therefore increasing the monetary value of overall trade goods for general people. To maintain gait with this inflationary consequence. the people withdraw nest eggs from the Bankss and utilize this fund for their dealing outgo. As a consequence bank faces liquidity crisis.

Non-recovery loan: – the overall per centum of recovery loan is really alarming. And this is another of import ground to increase the liquidness sector of commercial Bankss.

Proposed budget: – the proposed budget make a liquidness in the banking sector due to its over-reliance on domestic adoption for implementing the one-year development plan.


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