DHAKA, April 4: The Bangladesh Bank has asked all the private sector commercial banks, including the foreign banks, to raise their paid-up capital to Taka 1,000 million by March 10, 2005.

The central bank has also asked the private commercial banks with less than Tk1,000 million paid-up capital to raise 50 per cent of the amount by 10 March, 2004. The remaining 50 per cent has to be raised the following year.

Besides, the central bank has restricted banks from declaring cash dividends before reaching the prescribed paid-up capital level of Tk1,000 million.

They are, however, allowed to issue stock dividend or rights share.

According to the BB instructions, paid-up capitals of local private banks could be raised through mergers or amalgamations with amendments to memorandum of articles.

As regards the foreign commercial banks operating in the country, they could either bring fresh capital from outside or convert their net profit into capital.

However, the Bangladesh Association of Banks (BAB) at a recent meeting with the BB authorities concerned demanded that the private commercial banks be given ‘sufficient time’ for implementation of the BB regulation.