A Scenario of Inter-bank Call Money Arrangement and Its Affiliation with Twofold Variables: Empirical Evidences from Banking Industry of Bangladesh

Abstract

Inter-bank call money transactions make the stream of funds convenient and affordable for financial intermediaries. Consequently commercial banks get involved in the investment in and borrowing from call money market.  This arrangement plays a significantly vital role to strengthen the liquidity base of a bank and also provides ample avenue of investment of fresh funds. But sometimes repeated variations may distort the anticipated constancy of both money market and banking industry. The study is instigated to highlight the most recent past scenario of inter-bank call money arrangement and its association with twofold variables such as bank credit and excess liquidity. The basis is empirical as this investigation revolves around historical evidences.

Keywords: Money at call and short notices, Bank credit, SLR, Excess liquidity.