Bangladesh: Government Borrowing from Domestic Sources - February 2017

Transcription

1. Monthly Report On Government Borrowing from Domestic Sources1 July-February , FY'17 Research Department Bangladesh Bank 1 The report has been prepared by Money and Banking Division, Research Department, Bangladesh Bank (the Central Bank of Bangladesh). Comments are welcome to E-mail: mohammad.abdul@bb.org.bd.
2. Government Borrowing from Domestic Sources during July-February of FY '17 The government borrows from two domestic sources: banking system through Treasury Bills (T-Bills) & Bond and the non-banking system mainly through National Savings Directorate (NSD). The borrowing from banking sector is decreasing in recent times. Instrument-wise govt. domestic borrowing (net) during July-February, FY'17 is depicted in Figure-1. Figure-1: Instrument-wise Govt. Domestic Borrowing (Net) during July-February, FY'17 32,000 28,000 24,000 20,000 Taka in Crore 16,000 12,000 33282.6 8,000 4,000 0 -4,000 -8,000 -12,000 Ways and Means Adv. -4000.0 Overdraft -4031.6 Overdraft Block -1500.0 Govt. Currency Liabilities 0.0 Treasury Bills -2565.0 Treasury Bonds 1237.2 -1873.7 Special T. Bonds Balances of GIIB Fund -60.1 NSD Instruments 48.1 Adv. to Food Ministry Adv to Other Min,Auto&Semi-Auto -672.4 Accrued Interest 281.9 Govt. Deposits (-) -8290.9 -2.9 Other securities Source: Debt Management Department, Statistics Department, Bangladesh Bank, National Savings Directorate, February 2017 Govt. domestic borrowing (net) stood at Tk.11853.2 crore during July-February of FY'17 after the adjustments with T-Bills and Bonds, NSD, Ways and Means Advances (WMA), advances to Food Ministry and other Ministries, Overdraft (OD) current and block accounts, accrued interest, and advances and deposits of autonomous and semiautonomous bodies, balances of GIIB (Government Islamic Investment Bond) fund as well as deduction of cash balance in the form of govt. deposits with Bangladesh Bank and scheduled banks (i.e. including banking and nonbanking sources). It may be noted that the amount was Tk.11021.9 crore and Tk.11511.9 crore during July-January of FY’17 and July-February of FY’16 respectively. The govt. domestic borrowing (net) during July-February, FY'17 is 2.96 percent higher than that of the same period of the previous year. It may be mentioned that Govt. borrowed Tk.33282.6 crore through NSD instruments during the period. It is observed that govt. deposits increased by Tk.8290.9 crore (net) with the banking system during this period. Deposits with Bangladesh Bank (BB) increased by Tk. 7979.8 crore and deposits with scheduled banks (SBs) increased by Tk.311.1 crore.
3. 30 ,000 20,000 Taka in crore 10,000 0 -10,000 -20,000 BB SBs Non-Bank Jul-Feb Jul-Jan Jul-Dec Jul-Nov Jul-Oct Jul-Sept Jul-Aug -30,000 July From Figure-2, it is observed that the net borrowing from banking system is positive for the month of July, FY’17. After that, the govt. borrowed successively less than the amount of repayment and holding cash balances through banking system up-to JulyFebruary, FY’17. Figure-2: Movements in Government Domestic Borrowing during JulyFebruary, FY'17 40,000 Total Source: Debt Management Department and Statistics Department of Bangladesh Bank, National Savings Directorate, February 2017. Govt. borrowing from the banking system decreased by Tk.22164.1 crore during July-February of FY'17. On the other hand total non- bank govt. borrowing (net) stood at Tk.34017.2 crore during the period. As a result, govt. borrowing (net) from the domestic sources during July-February of FY'17 stood at Tk. 11853.2 crore. The movement in net govt. borrowing from different domestic sources during July-February of FY'17 is demonstrated in Figure-2. Figure-3: Monthly Trends in Government Domestic Borrowing during July-February of FY'17 20,000 15,000 Taka in crore 10,000 5,000 0 -5,000 -10,000 BB SBs Non-Bank Feb-17 Jan-17 Dec-16 Nov-16 Oct-16 Sep-16 Aug-16 Jul-16 -15,000 Total Source: Debt Management Department and Statistics Department of Bangladesh Bank, National Savings Directorate, February 2017. Figure-3 shows the monthly movement of government’s net domestic borrowing during JulyFebruary of FY’17. The net borrowing stood at TK. 831.3 crore (repaid TK. 1393.5 crore to BB and TK. 1811.1 crore to SBs and borrowed TK. 4035.9 crore from non-bank) in February, 17. Govt. borrowing increased by TK. 2787.3 crore in January, 17.
4. In the budget of FY '17, Tk.61548.0 crore has been fixed for borrowing from domestic sources by the government of which Tk.38938.0 crore and Tk.22610.0 crore have been targeted to borrow from banking and non-banking sources respectively. During July-February of FY'17, the net repayment and holding of cash balances with Bangladesh Bank stood at Tk. 13845.7 crore. On the other hand, the net repayment and holding of cash balances with scheduled banks stood at Tk.8318.4 crore during the same period. Figure-4: Budget Target and Net Govt. Domestic Borrowing during July-February of FY'17 Bangladesh Bank -13845.7 -8318.4 Scheduled Banks Actual (Banking System) -22164.1 38938.0 Target (Banking System) Actual (Non-Bank) 34017.2 Target (Non-bank) 22610.0 Actual (Total) 11853.2 61548.0 Source: Debt Management Department and Statistics Department of Bangladesh Bank, National Savings Directorate, February 2017. A comparative picture of government total budget target and actual domestic borrowing situation during July-February of FY'17 is shown in Figure-4. During the period, govt. repaid (net) Tk. 3936.2 crore through T-Bills and Bonds from the banking system. However, government total borrowing from other than banks (including NSD, TBills and Bonds) stood at Tk. 34017.2 crore. Government borrowed Tk. 33282.6 crore through NSD instruments during the period. The total net government domestic borrowings (banking and non-banking sources) stood at Tk. 11853.2 crore during JulyFebruary of FY'17 which is 19.3 percent of total budget target. 64,000 56,000 48,000 40,000 32,000 24,000 Taka in Crore 16,000 8,000 0 -8,000 -16,000 -24,000 Target (Total))
5. Major Changes /Findings of the Govt. Borrowings from Domestic Sources: • Total Govt. domestic borrowings (net) from banking system decreased by Tk.221.6 billion during July-February of FY'17. • Govt. borrowed Tk. 340.2 billion (of which Tk. 332.8 billion through NSD instruments) from other than banks during July-February of FY'17, which already has exceeded the total budget target from non-banking sources. • As the interest rate of NSD certificate is significantly higher than any other interest rate prevailing in the domestic market, Govt. borrowing is increasing much through NSD certificate.
6. Annex-1 Table I : Government Borrowing Position from the Banking System during July-February of FY17 (Provisional) (Taka in crore) Sl. No. Particulars 1 2 Issue and Maturity Objectives date 3 4 Outstanding Outstandin Outstandin Change (+) / (-) as on g as on g as on 30 June 16 31 January 178 February 1 February 17 July-February 5 6 7 8=(7-6) 9=(7-5) A. Bangladesh Bank 1. Ways and Means Advances To increase Government cash balance 2. Overdraft 3. Overdraft Block 4. Devolvement a) Treasury Bills b) Treasury Bonds 5. Government Currency Liabilities 6. Advances to Autonomous and Semi-autonomous Bodies 7. Accured Interest 8. Government Deposits@/ (-) 9. BB's Balances of GIIB Fund (-) A. Total : (1 +...+ 9)* 4000.0 0.0 0.0 0.0 -4000.0 4031.6 7185.0 4678.6 1562.9 3115.7 2026.3 0.0 73.9 -47.1 -8590.3 13358.0 0.0 5685.0 4324.5 573.9 3750.6 2026.3 0.0 69.7 -5592.0 -5607.7 905.8 0.0 5685.0 4324.5 573.9 3750.6 2026.3 0.0 84.1 -8026.9 -4580.7 -487.7 0.00 0.0 0.0 0.0 0.0 0.0 0.0 14.4 -2434.9 1027.0 -1393.5 -4031.6 -1500.0 -354.1 -989.0 635.0 0.0 0.0 10.2 -7979.8 4009.6 -13845.7 24061.1 23167.3 22580.8 -586.5 -1480.3 24061.1 23167.3 22580.8 -586.5 -1480.3 100829.5 101443.2 100601.4 8521.5 26336.6 38596.0 15365.0 7369.3 26294.5 38918.8 16124.1 7161.3 26027.6 38549.9 16114.0 -841.8 -208.0 -266.9 -368.9 -10.1 -228.1 -1360.2 -309.0 -46.1 749.0 12010.5 12736.5 12748.7 12.1 738.2 13887.7 12014.0 12014.0 0.0 -1873.7 13887.7 12014.0 12014.0 0.0 -1873.7 B. Deposit Money Banks (DMBs) 1. Government Treasury Bills i) Treasury Bills (Less than 1 year) 2. Bangladesh Govt. Treasury Bonds (BGTB) i) 2-years Bangladesh Govt.Treasury Bonds ii) 5-years Bangladesh Govt.Treasury Bonds iii) 10-years Bangladesh Govt.Treasury Bonds iv) 15-years Bangladesh Govt.Treasury Bonds v) 20-years Bangladesh Govt.Treasury Bonds 3. Others Treasury Bonds a) 5 Years and above (Specialized Bonds) To increase Government cash balance To increase long-term investment of different banks, non-bank financial institutions and employees GF of different companies
7. Issued 16 Jan-2011 and To repay the loan of BJMC maturity date 16 January & BTMC 2017, 18 & 21 respectively To compensate for the Issued 1 Nov-1993 and 25-years (Jute)Treasury Bond-2018 bearing 5.0 liquidation of jute sector ii) 7/ maturity date 1 Nov-2018 percent interest credit To compensate for the 25-years (Jute) Treasury Bond-2019 bearing 5.0 Issued 30 Jun-1994 and liquidation of jute sector iii) maturity date 30 Jun-2019 percent interest4/ credit To reimburse one-third of 25-years (Jute) Treasury Bond-2020 bearing 5.0 Issued 1 Jul-1995 and the debt due to jute mills' iv) loan write-off by the private percent interest1/ 2/ maturity date 1 Jul-2020 banks. Issued 25 Sep-2007 and To repay the loan of 10-years to 15-years (BPC) Treasury Bond bearing v) Maturity date from 25 Sep- Bangladesh Petroleum 5.0 percent interest 2014 to 25 Sep-2022 Corporation Issued 5 Oct 2011 and 26 To repay the loan of 5-years and 6-years (BPC) Treasury Bond bearing Dec 2011 and Maturity Bangladesh Petroleum vi) 7.0 percent interest5/ date 5 Oct-2016 and 26 Corporation Issued 23 Oct-2011 and 5-years to 13-years BJMC Treasury Bond bearing maturity date 23 October vii) To repay the loan of BJMC 5.0 percent interest6/ 2016, 20, 22 & 24 respectively Issued 29 June-2013 and viii) 7-years SPTB-2020 bearing 7.0 percent interest maturity date 29 June-2020 To increase Government Issued 29 June-2013 and ix) 8-years SPTB-2021 bearing 7.0 percent interest maturity date 29 June-2021 cash balance Issued 29 June-2013 and x) 10-years SPTB-2023 bearing 7.0 percent interest maturity date 29 June-2023 Sub-Total : (1+2+3) Prize Bond/Income Tax Bond Government's other Securities Advances to Food Ministry Advances to Other Ministries Advances to Auto./Semi-Autonomous Bodies Accrued Interest Deposits of Ministries and Departments (-) Deposits of Auto./Semi-Autonomous Bodies (-) SBs's Balances of GIIB Fund (i+ii) i) 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 6, 7 &10-years (BJMC&BTMC) interest free Treasury Bond-2016, 2017 &20208/ 677.9 339.0 339.0 0.0 -338.9 53.2 29.6 29.6 0.0 -23.6 36.9 36.9 36.9 0.0 0.0 11.6 8.9 8.9 0.0 -2.7 2922.5 2922.5 2922.5 0.0 0.0 2100.0 950.0 950.0 0.0 -1150.0 2150.4 1792.0 1792.0 0.0 -358.4 2000.0 2000.0 2000.0 0.0 0.0 2000.0 2000.0 2000.0 0.0 0.0 1935.1 1935.1 1935.1 0.0 0.0 138778.4 30.5 2.8 549.4 1453.8 1908.4 2908.7 -21805.5 -34069.1 8414.5 136624.5 10.1 3.9 646.0 1403.5 1453.5 2728.8 -21861.8 -34722.9 5378.9 135196.2 26.6 3.8 597.5 1432.4 1257.4 3180.4 -21438.1 -34747.6 4344.8 -1428.3 16.5 -0.1 -48.5 28.9 -196.1 451.6 423.7 -24.7 -1034.1 -3582.1 -3.9 1.0 48.1 -21.4 -651.0 271.7 367.4 -678.5 -4069.7
8. i ) Investment to GIIB Fund ii) Borrowing from GIIB Fund (-) B. Total : (4+…+13) Grand Total : (A+B)* Notes: @/ Including other deposits. 1/ 2 year Bangladesh Government Treasury Bond was introduced in May 2013 12189.1 -3774.6 98171.9 111529.8 9138.5 -3759.6 91664.5 92570.3 8456.4 -4111.6 89853.4 89365.7 -682.1 -352.0 -1811.1 -3204.6 2/ An amount of Tk. 2.7 crore was paid in July 2016 against the outstanding of Tk. 11.6 crore in June 2016 3/ *Including GIIB Fund 4/ An amount of Tk. 16.4 crore was paid in June 2016 against the outstanding of Tk. 53.3 crore in June 2015 5/ An amount of Tk. 1150.0 crore was paid upto December 2016 against the outstanding of Tk. 2100 crore in June 2016 6/ An amount of Tk. 358.4 crore was paid in October 2016 against the outstanding of Tk. 2150.4 crore in June 2016 7/ An amount of Tk. 23.6 crore was paid in November 2016 against the outstanding of Tk. 53.2 crore in June 2016 8/ An amount of Tk. 338.9 crore was paid in January 2017 against the outstanding of Tk. 677.9 crore in June 2016 Source: Debt Management Department, Statistics Department, Bangaldesh Bank ( Figures of Treasury Bills and Bonds (Including Special Bonds) are collected from DMD). -3732.7 -337.0 -8318.4 -22,164.1
9. Annex-2 Table-II : Government Borrowing (Net) from Other than Banks during July-February of FY17 (Taka in Crore) Sl. No. 1 Particulars 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 2 NSD Instruments Defence Savings Certificate 5-year Bangladesh Savings Certificate 3-year Savings Certificate Bonus Savings Certificate 6-month interest bearing Savings Certificate Family Savings Certificate 3-month interest bearing Savings Certificate Jamanat Savings Certificate Pensioner Savings Certificate Post Office Savings Bank a) General Account b) Fixed Account c) Bonus Account Postal Life Insurance Prize Bond Wage Earners' Development Bond 3-year National Investment Bond US $ Premium Bond US $ Investment Bond Total : (1+...+15) 18. Govt. Treasury Bills/Bonds Sale 3 July-February 2016 Repayment Principal Interest 4 5 0.0 4.3 4087.6 1737.7 0.0 11.4 0.0 0.0 0.0 0.0 11492.2 2769.7 8756.6 3791.1 0.0 5.2 1855.9 1171.2 5562.4 3256.9 1095.8 913.5 4466.6 2343.3 0.0 0.0 50.8 67.9 50.2 36.7 865.1 143.5 0.0 0.7 24.6 29.1 321.9 151.4 33067.3 13176.7 Outstandings as on February 2016 23576.6 3.8 717.6 0.0 0.0 0.0 3000.2 1524.6 0.5 483.5 871.8 26.7 845.1 0.0 0.4 7.8 392.5 0.2 17.3 76.4 7096.5 Net Sale 6 = (3-4) July-February 2017 Repayment Sale Principal Interest 7 8 9 Net Sale 10 = (7-8) -4.3 2349.9 -11.4 0.0 0.0 8722.5 4965.5 -5.2 684.7 2305.6 182.2 2123.3 0.0 -17.1 13.4 721.6 -0.7 -4.5 170.5 19890.5 Net Changes 0.5 0.0 1.5 2.1 3994.1 1008.3 328.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 17610.9 3831.3 4850.3 12777.1 3970.4 2353.3 0.0 0.0 0.0 3279.5 849.8 716.8 8464.6 3873.3 1142.1 1527.7 1216.4 153.0 6936.9 2656.8 989.1 0.0 0.0 0.0 58.5 16.5 58.9 60.2 29.0 9.6 710.6 119.7 310.6 0.0 0.8 0.1 11.3 15.3 14.7 164.4 91.2 35.8 47131.5 13848.9 9780.8 Outstandings as on February 2017 24828.1 -1.5 2985.8 0.0 0.0 0.0 13779.6 8806.8 0.0 2429.7 4591.3 311.3 4280.0 0.0 0.4 31.2 590.9 -0.8 -4.0 73.1 33282.6 Net Changes 734.7
10. i ) Government Treasury Bills ii) Bangladesh Govt. Treasury Bonds (BGTBs) a) 2-year Bangladesh Government Treasury Bonds b) 5-year Bangladesh Government Treasury Bonds c) 10-year Bangladesh Government Treasury Bonds d) 15-year Bangladesh Government Treasury Bonds e) 20-year Bangladesh Government Treasury Bonds 19. Total Non-bank Government Borrowing (net) : (17+18) Sources : National Savings Directorate, Debt Management Department, BB. 748.93 22827.6 345.51 5838.44 9485.60 2989.29 4168.79 -135.9 136.3 -520.0 -30.9 669.6 133.5 -115.8 19891.0 216.56 24611.59 388.90 5904.13 10252.07 3386.53 4679.96 -95.7 830.4 -79.8 -185.5 429.9 324.0 341.8 34017.2