Some bank officials said that many banks are facing cash crunch due to loss of customer confidence due to irregularities. Some banks are in urgent need of cash because of buying dollars.
High inflation, declining deposit growth and rising credit demand are leading to a liquidity crunch. As a result, demand for short-term loans in the interbank market increased.
Syed Mahbubur Rahman, Managing Director and CEO of Mutual Trust Bank, told UNB that there is pressure to withdraw cash every year before Eid. Because before Eid, companies give salary and bonus to their employees.
Apart from this, people keep cash in hand for the expenses related to Eid. Therefore, there is a high demand for cash in banks. To meet these demands, banks borrow from the call money market.
