Gold, silver reserve

BB had Tk 1,671cr loss last fiscal

13 February 2014 Kazi Zahidul Hasan

Bangladesh Bank (BB) suffered a loss of Tk 1,671 crore from the reserve of gold and silver last fiscal (2012-13) as value of the metals had fall in global market, official sources said on Tuesday.
The revaluation loss happened due to decrease in value of gold and silver in the international market, he said, adding that this revaluation loss was taken into other comprehensive income and subsequently transferred to the reserve account.
BB has gained Tk 827.16 crore from the gold reserve in the fiscal 2011-12, capitalising ever rising value of the precious metal in the global market.
Though the central bank has benefited from the gold reserve in 2011-12 fiscal, it incurred Tk 4.99 crore losses from the reserve of silver during the period due to its falling value in the international market.
A senior BB official said that like many other central banks BB also diversified its reserve to gold considering a good investment option in the wake of global economic crisis and falling value of major currencies, including US dollar in the global market.  
When asked, he said that although there are always some risks in investing gold, the central bank took the decision considering global economic situation.
In response to a query, he said, the central bank is undecided about selling its gold stock due to its falling value in the global market.  
"The BB right now is not thinking about selling of its gold reserve as there are not many alternative investments," he noted.   
Justifying the gold reserve by BB, the official said, not only Bangladesh, the central banks of many countries including China, South Korean, Paraguay, Kazakhstan and Turkey recently diversified their foreign exchange reserve holdings with gold to reap a long term benefit from the precious metal.
Sources in the central bank said, the total gold reserve of BB now stands at 13 tonnes, which is six per cent of its total foreign exchange reserve. Besides, the value of the reverse is more or less $700 million.
It has deposited all of its gold reserve in the Bank of England (BoE).
Meanwhile, BB faced a huge loss on foreign currency revaluation during the fiscal 2012-13.

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