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The Bangladesh Bank Order, 1972 (President's Order)

( PRESIDENT'S ORDER NO. 127 OF 1972 )

[ 31st October, 1972 ]

Chapter III

BUSINESS AND FUNCTIONS OF THE BANK

36. 1[(1) Every scheduled bank shall maintain with the Bank a balance the amount of which shall not be less than such portion of its total demand and time liabilities as may be prescribed by the Bank pursuant to the monetary policy objectives of the Bank, by notification in the official Gazette.
 
 
Explanation.- For the purposes of this Article liabilities shall not include the paid-up capital or the reserves, or any credit balance in the profit and loss account of such bank or the amount of any loan taken from the Bank.
 
 
(2) Based on the monetary policy objectives pursued by the Bank, it shall prescribe from time to time the terms and conditions of admissibility of interest, and the rate of interest, on the required minimum balances and/or on amounts in excess of the required minimum balances.]
 
 
2[ * * * ]
 
 
(3) Every scheduled bank shall send to the Bank returns signed by two responsible officers of such bank containing such information as may be deemed necessary for carrying out the purposes and objects of this Order at such periods of time as the Bank may from time to time direct.
 
 
3[(4) If at the close of business on any day before the day fixed for the next return under the preceding clause, the balance held at the Bank by any scheduled bank is below the minimum fixed by clause (1) such scheduled bank may be ordered by the Bank to pay the Bank in respect of such day penal interest at such rate above the Bank rate as may be determined by the Bank from time to time on the amount by which the balance with the Bank falls short of the fixed minimum, and if, on the day on which the next return is due, such balance is still below the fixed minimum as disclosed by this return, Bangladesh Bank may impose a higher rate of penal interest above the Bank rate in respect of that day and each subsequent day on which the balance held at the Bank at the close of business on the day is below the fixed minimum.]
 
 
(5) When under the provisions of clause (4) penal interest 4[* * *] has become payable by a scheduled bank, if thereafter on the day fixed for the next return under clause (3) the balance held at the Bank is still below the fixed minimum as disclosed by this return-
 
 
(a) every director and officer of the scheduled bank, who is knowingly and wilfully a party to the default, shall by order of the Bank be punishable with fine which may extend to 5[Taka one lakh] and with a further fine which may extend to 6[Taka one lakh] for each subsequent day on which the default continues; and
 
 
(b) the Bank may prohibit the scheduled bank from receiving after the said day any fresh deposit, and if default is made by the scheduled bank in complying with such prohibition, every director and officer of the scheduled bank who is knowingly and wilfully a party to such default or who through negligence or otherwise contributes to such default shall by order of the Bank be punishable in respect of each default with fine which may extend to 7[Taka one lakh] for each day after the first on which a deposit received in contravention of such prohibition is retained by the scheduled bank.
 
 
8[* * *]
 
 
(6) Any scheduled bank failing to comply with the provisions of clause (3) shall by order of the Bank be liable to pay to the Bank a penalty of 9[Taka twenty five thousand] for each day during which the failure continues.
 
 
(7) Whoever in any return under this Article wilfully or recklessly makes a statement false in any material particular or wilfully or recklessly omits to state a material particular shall by order of the Bank be punishable with fine which may extend to 10[Taka ten lakh] in respect of each such return.
 
 
(8) The penalties imposed by clauses (4), (5), (6) and (7) shall be payable on demand made by the Bank and in the event to refusal by the defaulting bank, director or officer to pay on such demand, may be levied by a direction of the Civil Court having jurisdiction in the area where an office of the defaulting bank is situated, such direction being made only upon application made in this behalf to the Court by the Bank, with the previous sanction of the Government.
  • 1
    Clauses (1) and (2) were substituted by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 2
    Clauses (2A) and (2B) were omitted by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 3
    Clause (4) was substituted by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 4
    The words “at the increased rate of five per cent above the Bank Rate” were omitted by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 5
    The words “Taka one lakh” were substituted for the words “Taka five hundred” by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 6
    The words “Taka one lakh” were substituted for the words “Taka five hundred” by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 7
    The words “Taka one lakh” were substituted for the words “Taka five hundred” by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 8
    The Explanation was omitted by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 9
    The words “Taka twenty five thousand” were substituted for the words “Taka one hundred” by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
  • 10
    The words “Taka ten lakh” were substituted for the words “Taka one thousand” by section 14 of the Bangladesh Bank (Amendment) Act, 2003 (Act No. IX of 2003)
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