To address a liquidity crisis, commercial banks borrowed 13,020 crore taka from the central bank in a single day through repo and liquidity support facilities.

On Tuesday, in an auction, 32 banks and four non-bank financial institutions (NBFIs) borrowed this amount from the central bank through repos and liquidity assistance. This continues the trend of commercial banks relying on borrowing from the Bangladesh Bank.

A senior official of the central bank informed the media that the banks have been receiving liquidity support daily for the past few months amid a liquidity crisis in the banking sector.

The official further stated that the central bank has now reduced the liquidity support to the banks. Starting from July, liquidity assistance through repos will shift from daily to weekly.

Meanwhile, commercial bankers stated that a liquidity crisis has arisen in the overall banking sector due to high inflation, foreign currency crisis, increasing interest rates on government treasury bills, and policy rate hikes.

They reported that some banks are now investing in treasury bills using liquidity support from the central bank, as the interest rates on treasury bills have exceeded 11%.

Notably, in yesterday's auction, 18 banks and four NBFIs took 7,563 crore taka under a seven-day repo facility. Additionally, 14 banks took 5,457 crore taka under a one-day liquidity support facility, with interest rates at 8.10% and 8% respectively.

Not just the central bank, but banks are also turning to the call money market to borrow funds.