Regulatory Alerts2025-09-22
Added
DMD Circular Letter No. 14: Assured Liquidity Support for Primary Dealers
The Department of Monetary Management of Bangladesh Bank establishes a temporary assured liquidity support mechanism for Primary Dealers (PDs) regarding eligible collateral for Treasury bills and bonds. Under this arrangement, Treasury bills and bonds purchased by PDs from primary auctions held within two months prior to the liquidity support date are eligible as collateral from October 1, 2025, to October 31, 2025. The eligibility window is reduced to one month prior to the support date for the period from November 1, 2025, to November 30, 2025. The assured liquidity support scheme will cease to be effective starting December 1, 2025.
Bangladesh Bank (Central Bank of Bangladesh) Department of Monetary Management Head Office Motijheel, Dhaka-1000 Bangladesh.
Managing Director / Chief Executive All Primary Dealer Banks operating in Bangladesh Dear Sir,
Regarding the provision of Liquidity Support to Primary Dealers (LS-PD).
Reference is invited to DMD Circular Letter No. 7 dated December 23, 2021, on the above-mentioned subject. It is informed that, with the aim of maintaining consistency in the interest rate structure in the money market and implementing the full transmission of monetary policy, Bangladesh Bank has taken the following decisions regarding the provision of Assured Liquidity Support (ALS) in favor of Primary Dealer (PD) banks:
a) Treasury bills/bonds purchased by PD banks from primary auctions (issuance/re-issuance) held within 02 months prior to the date of ALS provision, from October 01, 2025, to October 31, 2025, will be considered eligible collateral;
b) Treasury bills/bonds purchased by PD banks from primary auctions (issuance/re-issuance) held within 01 month prior to the date of ALS provision, from November 01, 2025, to November 30, 2025, will be considered eligible collateral; and
c) ALS will not be provided from December 01, 2025.
Yours faithfully,
(Isteyak Hossain) Director (DMD) Phone: 9530131 E-mail: isteyak.hossain@bb.org.bd
DMD Circular Letter No. 14 Date: 07 Ashwin, 1432 Date: --------------------- 22 September, 2025