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Distrust in banks makes savings bonds hot in Bangladesh

More national savings certificates are being sold in Bangladesh as it is considered as the safest investment instrument.

The net investment in savings certificates was Tk 4.62 billion in the first two months (July-Aug) of the current 2012-13 fiscal year, based on data released by Bangladesh Bank. It was Tk 3.37 billion in the same period and Tk 4.79 billion during the entire 2011-12 fiscal year.

"The people have lost their trust in banks due to the Hallmark scam involving Sonali Bank and other financial irregularities in other banks. That is why many of the investors have seemingly moved to the once safest' option turning away from depositing money with the banks," said Dr Zaid Bakht, economist and Research Head of the Bangladesh Institute of Development Studies.

Moreover, he said, the people are investing in the national savings bonds since the share market is yet to stabilise.

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