Written by The Banking Post
Bangladesh Bank is set to hold another special auction of Tk5,000 crore in 91-day treasury bills on April 8, as the government steps up short-term borrowing to meet rising financing needs.
With this, total funds raised through such special auctions in April will reach Tk10,000 crore, central bank officials said.
The move reflects growing reliance on the banking sector amid a revenue shortfall and mounting expenditure pressures. Bankers say the situation has been eased by surplus liquidity in the banking system, allowing the government to borrow without immediate strain.
Recent data shows banks parked around Tk11,500 crore in the central bank’s standing deposit facility, indicating excess funds. This has encouraged the central bank to mobilise liquidity through treasury bill auctions.
Bangladesh Bank’s ongoing dollar purchases from commercial banks since the start of the fiscal year have also injected additional liquidity into the system, further supporting such borrowing.
Earlier, the government resorted to off-calendar borrowing in the October–December quarter, raising around Tk10,000 crore to meet urgent funding requirements. Such auctions typically signal immediate cash needs, often linked to public expenditure programmes.
For the April–June quarter, the government plans to borrow Tk1.10 lakh crore through treasury bills, including Tk44,000 crore in 91-day bills, Tk36,000 crore in 182-day bills, and Tk30,000 crore in 364-day bills, to be issued through weekly auctions.
In addition, Tk39,000 crore is targeted to be raised through medium- and long-term treasury bonds.
Central bank officials said the borrowing plan is aligned with financing needs and does not necessarily indicate net debt accumulation, as maturing securities are regularly rolled over.
Meanwhile, private sector credit growth remains weak at around 6.03 percent, reflecting subdued investment demand. With limited lending opportunities, banks are increasingly shifting funds into government securities, which offer stable, risk-free returns.
