DMD Circular No. 01: Regarding Transactions of Government Securities

Bangladesh Bank (Central Bank of Bangladesh) Department of Management and Development Head Office Motijheel, Dhaka-1000.

DMD Circular No. 01/2020 Date: -------------------- Managing Director/Chief Executive Officer All Scheduled Banks and Financial Institutions operating in Bangladesh.

Dear Sir/Madam,

Regarding the purchase and sale of government securities.

You are aware that the Department of Management and Development of Bangladesh Bank purchases government securities from the primary and secondary markets, and sells them in the secondary market when necessary, to develop the secondary market for government securities and to implement monetary policy objectives. Such transactions are conducted at market prices.

2. Bangladesh Bank regularly provides repo facilities to all scheduled banks and financial institutions operating in Bangladesh against government securities. In view of the coronavirus (COVID-19), to prevent any hindrance in the liquidity management of banks and financial institutions in the country, Bangladesh Bank has decided to strengthen the program of purchasing government securities from the secondary market.

3. To this end, if any scheduled bank or financial institution holds additional government securities after maintaining 'High Quality Liquid Assets (HQLA)', it may sell them to Bangladesh Bank at market price. Banks and financial institutions wishing to make such sales are advised to contact this department.

Yours faithfully,

(Md. Khorshed Alam) General Manager Phone: 9530131 E-mail: khorshed.ahmed@dmd.bb.gov.bd

08 Chaitra, 1426 Bang 22 March, 2020 AD