Bangladesh Bank Permits Banks to Invest in Green Sukuk from Capital Market Investment Special Fund

Bangladesh Bank (BB) has issued new provisions enabling all scheduled banks in the country to invest in private Green Sukuk using special funds allocated for investment in the capital market, according to a circular dated 27th of September 2021.

Why it Matters?

Under the new provisions, the entire amount in the special fund of each bank (BDT 2.0 billion) meant for capital market investment can now be invested in 100% asset-backed Green Sukuk, having at least 70% of their fund in solar power, hydropower, wind power projects and other sources of renewable energy projects. The amendments were made to bring new investment instruments and diversity to instruments to reduce investment risks, as well as to facilitate the use of renewable energy to achieve su...