Your AD Bank: What an Authorised Dealer Bank Actually Does in Every Bangladesh Import

Behind every legal import into Bangladesh there is a bank — specifically, an Authorised Dealer bank. An AD bank is a branch that Bangladesh Bank has licensed to deal in foreign exchange, and only an AD branch can open a letter of credit, register the import authorisation, remit payment abroad and report the transaction to the central bank. If you are importing from China, your relationship with your AD branch shapes your costs, your timelines and how much friction every shipment carries. It is worth understanding what the bank is actually doing.

What "Authorised Dealer" means

Bangladesh operates exchange control: foreign currency cannot simply be bought and sent abroad at will. Bangladesh Bank delegates the day-to-day administration of that control to commercial bank branches it authorises as dealers in foreign exchange. Not every branch of a bank is an AD branch. When you route an import through an AD branch, that branch is acting partly as your service provider and partly as an agent of the central bank — checking that the transaction is permitted under the Import Policy Order and the Guidelines for Foreign Exchange Transactions, and reporting it upward.

The AD bank steps through a normal import

• Registration of the import authorisation. Before goods ship, the AD branch registers the Letter of Credit Authorisation form against your import registration certificate and the proforma invoice. This ties a specific value of foreign currency to a specific import.
• Opening the LC or arranging the payment channel. For an LC import the AD branch is the issuing bank; for a contract or advance-payment import it still records the terms and handles the remittance.
• Lodging the shipping documents. When the exporter’s documents arrive, the AD branch checks them against the LC or contract terms — invoice, transport document, packing list, certificate of origin, insurance — and releases them to you so you can clear the goods.
• Remitting payment. The branch sends the funds abroad through its correspondent banking network and debits your account, converting taka to foreign currency at its rate for that day.
• Reporting. The branch reports the outward remittance and, later, matches it against proof that the goods actually arrived, so the central bank can see the currency bought foreign goods and did not just leave the country.

Why the bank cares whether the goods arrived

An outward remittance for an import is provisional in the central bank’s eyes until it is reconciled against the bill of entry showing the goods were cleared in Bangladesh. Your AD branch will ask you for the customs-certified bill of entry after clearance and will follow up if you do not provide it. Repeatedly remitting for imports that cannot be evidenced is exactly the pattern exchange control exists to catch, and an importer who cannot produce bills of entry against past remittances will find the next LC much harder to open.

What the AD relationship costs you

The bank’s services are not free, and the charges are worth itemising because they vary between banks:

• LC opening commission, usually charged per quarter or part-quarter of the LC validity, plus amendment charges if terms change.
• A margin requirement — the percentage of the LC value you must keep with the bank as cash cover, which can be a large working-capital cost and is negotiable based on your relationship.
• Document handling and SWIFT charges for messages sent.
• The foreign-exchange spread — the difference between the rate the bank gives you and the interbank rate — which on a large remittance is often the biggest single cost.
• Acceptance or usance commission if the supplier is giving you deferred payment terms.

None of these has a fixed number that applies to everyone; they depend on the bank, the LC size, your credit standing and how much other business you give the branch. That is precisely why the relationship matters.

Choosing and managing an AD branch

Practical things that make a difference: pick a branch that handles import LCs routinely and has trade-finance staff who know the China trade, not a small branch where every LC is an event. Give the branch enough total business that your margin and commission are negotiable. Submit clean, complete documents so amendments are rare. Keep your import registration certificate, trade licence, TIN and VAT registration current, because an expired document stops an LC cold. And provide bills of entry promptly after each clearance so your remittance reconciliation never falls behind.

Where DE International fits

We are not your bank, but our sourcing and clearing work feeds the bank at every step: an accurate proforma invoice for the LCA registration, shipping documents that match the LC terms so the branch does not raise discrepancies, and a customs-certified bill of entry handed back promptly for reconciliation. We coordinate with your AD branch so the paperwork moves in the right order. Because bank charges are specific to your institution and facility, we cannot quote them — ask your branch for its schedule, and ask us to make sure the trade documents never give them a reason to delay.

See our services, and our related guides on the LCA form, how a letter of credit works and telegraphic transfer payments. To plan a specific import, contact DE International, or explore our sourcing service and shop.