Sheikh Shahariar Zaman

Off-shore banking operation has suffered a setback as global economic recession pushes down the export growth of the country.

"We have been facing difficulties during the last six months in our off-shore operation due to slump in exports," said Rajib Bin Rashid, trade and supply chain manager of HSBC, Bangladesh.

Business growth of the off-shore unit of the bank was not as expected, he said.

He, however, said the overall transaction has not fallen sharply as the bank handles about 7.5 per cent of the total export of the country.

"Last year was fine as the bite of the recession was not felt that much, but this year we don't see a good growth," he said.

If there is turnaround in late 2009, the situation will improve and the off-shore units can do better business, he added.

Off-shore banking unit offers services to investors and businessmen involved in export processing zones and all its transactions are in foreign currencies, mainly in US dollar.

Export of high-end products has fallen drastically in the last six months or so, said AAM Hayatur Rashid, Dhaka Bank operations manager of Savar EPZ branch.

The impact of the recession was not felt much in 2008, but it has been much visible since March, 2009, he said.

"Demand for backward linkage products has also dropped in the last couple of months," he added.

He, however, said export order for low-end products increased in recent times.

An official of Seoul-based Woori Bank said profit and revenue of off-shore banking unit fell by 10 to 20 per cent in the last six months.

Woori Bank and Standard Chartered Bank started first off-shore banking units in the country in 1996.

"We are not worry about the recent business trend as it is expected that there will be a turnaround late this year or early next year," he said.

An official of Prime Bank said import and export trade is sluggish this year and it affects the off-shore operation of the bank.

"Usually, October to March is the prime time, but this year the business was relatively bad," he said.

There are 11 local and foreign banks providing off-shore banking facilities to their clients in the EPZs.

In the first 10 months of the last fiscal, factories in the EPZs exported goods worth $2.13 billion and investment stood at $125 million. There are 283 factories operating in the EPZs and 177 companies are setting up their factories.