Cash Flow Slowing

Transactions through BRAC Bank's ATM dropped by 7 percent in the last two months compared to the same time in the previous year, said Zeeshan Kingshuk Huq, head of corporate affairs and service quality. The trend in cash flow is more or less similar to the business houses that cannot deliver goods to retailers, who also cannot sell goods to consumers due to the ongoing strikes and blockades. Banks are also sitting on idle funds, as borrowers are not taking even their sanctioned loans. investing money Goods are being produced at our factories, but we cannot make deliveries and collect cash from the retailers, said Lutful Bari, director (operations) of Meghna Innove Rubber that makes tyres, tubes and parts for bicycles, motorcycles and CNG-run three-wheelers. Helal Ahmed Chowdhury, managing director of Pubali Bank, said there is no study on how the cash movement has dropped exactly, but it is certain that the cash flow has been hampered by the political impasse. Now, cash management has become a big challenge, as some branches have huge surplus funds and some are running short of cash, Chowdhury said.







Banks to take control of cash flow of Kingfisher Airlines





Industry circles think the move may be a prelude to a corporate debt restructuring programme where lenders jointly decide to reschedule loan repayments and lessen the borrower's burden. With oil companies asking the debt-laden airline to clear dues, banks are worried the company will find it difficult to pay interest on loans. According to another bank official, the lenders have decided to form a core group of five banks that will focus on the company's finances. The group includes State Bank of India , Bank of India, Bank of Baroda , Punjab National Bank and ICICI Bank. "There are 13 lenders and it's not feasible to bring them all together. Therefore, a core group of lenders is being formed," said the banker. SBI, the lead lender, has asked the airline to bring in Rs 400 crore in fresh equity before any loan restructuring can be initiated.