Dhaka, June 3 -- State-owned BASIC Bank has sought government approval to open and operate accounts of government and donor-funded projects as part of efforts to strengthen its deposit base, lower funding costs and improve its overall financial health, sources said.

In a recent letter to the Finance Ministry, Deputy Managing Director Abu Md Mofazzal requested the authorities to take necessary steps to allow the bank to manage such accounts.

The letter said that the problem-ridden bank's reliance on high-interest-bearing deposits remains a major challenge. It cannot achieve its desired level of profitability due to a large volume of classified loans and high-cost deposits, which have resulted in a relatively high cost of funds.

Accordin...