IMF’s $1.15bn third tranche takes Bangladesh’s reserves past $26.5bn

Bangladesh has received $1.15 billion in the third tranche of the International Monetary Fund’s $4.7 billion loan, more than the amount expected in this round.

South Korea, the International Bank for Reconstruction and Development, and the Islamic Development Bank also disbursed $900 million in total on Thursday.

The new funds helped the gross foreign currency reserves to cross $26.5 billion, said Bangladesh Bank spokesman Mezabaul Haque.

As transactions continued with the central banks of many other countries at night because of time difference, the actual reserves will be known on Friday, he said.

The IMF agreed to provide a total of $4.7 billion loan in 2023, contingent upon Bangladesh's commitment to ongoing development and infrastructure projects. Bangladesh sought the loan to create a buffer for fast depleting reserves.

The third tranche under the IMF's Extended Credit Facility for Bangladesh surpassed previous tranches of $68.2 million in December and $47.62 million in February 2023.

After reviews and inspections upon completion of development and infrastructure tasks, the IMF releases each tranche accordingly.

In the third tranche, Bangladesh has received $93.2 million under the Extended Credit Facility and Extended Fund Facility, along with $22

million under the Resilience and Sustainability Facility.

One of the IMF’s conditions for the third tranche was to keep the net reserves above $14.76 billion by June-end.

It was $20.1 billion for the second tranche, but the global lender relaxed the condition as Bangladesh made improvements in other areas.

For the next rounds, Bangladesh will need to keep the net reserves above $14.88 billion by the end of September and $15.3 billion by the end of December.

Bangladesh Bank does not publicise the net reserves, but give the figures to the IMF and other organisations.