As there is a possibility of bigger bank borrowing for financing the newly-passed big budget, Bangladesh Bank (BB) Governor Dr Atiur Rahman said a changed monetary policy will spell out restrictions on the government's taking money from the banks, report UNB and bdnews24.com.

The Bangladesh Bank will announce the new monetary policy by July 15 to help implement the budget, he told reporters Thursday on return from a banking conference abroad.

"One of the main focuses of the next monetary policy would be to restrain the government from big borrowing from the banking sector," the BB governor said.

Responding to a question, the new chief of the central bank said to implement the current budget the government would need a huge amount of money. "This huge money has to come from revenue and banking sectors."

In this context, he noted that the government has to pay less attention to the banking sector to get money for its budget implementation.

On the other hand, there are reports airing scepticism about mobilising the targeted huge amount of revenues in the just-started fiscal year because of the tax cuts on a number of items during the passage of the Tk 1,138.19 billion budget. The total revenue target is Tk 794.61 billion.

Saying that the confidence regarding investment has to be emboldened, the governor expressed the hope that this maiden budget of the new government would ensure that for the investors.

"The present monetary policy will continue after making some little changes," Dr Atiur Rahman told the reporters on return from his Euro tour.

About his findings in the meeting with the world's other central banks' chiefs at this crucial hour of global financial turmoil, Atiur said the recession occurred due to global imbalance in the economy.

"This imbalance occurred for crisis in financial sector, in actual economy and in the confidence," he said about the situation dubbed by some western economists as 'the collapse of capitalism' that sent an avalanche from America through the western hemisphere plus Japan.

He said the meeting stressed reforms in the world financial sector to avert a recurrence of such pandemic recession in future.

"We discussed the end of the ongoing bailout packages in different countries. Many central bank chiefs said they need to exit from the ongoing bailout packages as soon as possible," he added.

The meeting decided to look after more strongly from the central bank side in the banks' risk management as a safeguard.

"We also put emphasis on risk-management system of Bangladesh's banks," he said.

The central bank boss unveiled a plan that from the Bangladesh Bank they would look after the banks so that they cannot go beyond their capacity. And each bank has to have a risk-management unit and an official in the unit who will not only inform the chief executive officer of the bank, but also inform the respective bank board about the state of affairs.

"No bank will be allowed to do whatever they want, Bangladesh Bank will keep its eye on each bank in this connection," he said about the upcoming strict supervision mechanism.

About his London tour Dr Atiur said he met the officials of the Sonali Bank's London Branch.

"The branch has been modernised after reforms, they introduced tele-banking there. But the capacity of the branch has not been totally utilised," he told the journalists.

Dr Atiur asked them to go for trade financing. In reply the Sonali Bank officials in the British capital informed the BB governor that they would go for trade financing by the end of this year.

The governor also met the non-resident Bangladeshis in London and discussed their future proposals of investment back in Bangladesh.