Daily Business News Mongolia

MP O.Chuluunbat: If we don’t react quickly, we will die in hunger

It is wrong for commercial banks to attract saving deposit with high interest rate.

MP O.Chuluunbat shares his views in this time of crisis and turbulence in the economy.

Q: Several years ago, saving and credit cooperatives offered so high interest for its saving deposits in order to attract its clients, but they went bankruptcy soon after. As for me, recently, commercial banks are repeating the same reaction and measures as the cooperatives did long ago before they had gone bankruptcy. What would you say?
O.Chuluunbat: Commercial banks have huge saving deposits from people. Therefore, the State shall monitor the commercial banks whether they are reliable or not, working good or not. Actually, the whole world is working like this. Also, people must be warned and updated with the situation. In other words, the Government organizations shall financially be transparent. The state and the financial organizations work for the interest well of people. (more…)

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O.Chuluunbat: Won’t buy shares of commercial banks.

Q: Why the commercial banks of Mongolia stopped their loan?
O.Chuluunbat: World countries report their economy condition. Otherwise, banking sector is very vulnerable. More precisely, it based on the main factors and trusts of people and is affected directly and instantly by the international economy condition. If commercial banks undergo any difficulties, the government must take a measure. Also the Parliament and the Government start taking about certain measures that are effective for the current situation. But it didn’t consider of buying shares of commercial banks like in USA. It is the risk of commercial banks.

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O.Chuluunbat: There is nothing to fear

We got details from O.Chuluunbat, Parliament member on information related to the draft resolution on State Monetary Policy Guidelines of the year 2009 in compliance with 10.2 of the Article 10 of the Mongol bank law of Mongolia submitted to the Parliament on Oct. 29. (more…)

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UPDATE 3-Mongolia authorises bank capital injection

By Lucy Hornby

ULAN BATOR, Oct 28 (Reuters) - Mongolia’s cabinet on Tuesday authorised a capital injection into the nation’s commercial banks but will hold off implementing it for now, government officials said on Tuesday.

Former central bank governor O Chuluunbat said earlier on Tuesday that a rescue package of around $500 million could be ready as early as next week for the country’s pressured banks, which have struggled for months with a frozen mortgage market. (more…)

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Statement of Mongol Bank

Reuters agency informed that the Mongolian Government is to bailout 500 million US$ for its commercial banks. The Bank of Mongolia made and official statement regarding this information.

“Reuters agency interviewed MP O.Chuluunbat, a former President of Mongol Bank, on October 28 2008. In the interview it said that the Mongolian Government is to bailout 500 million US$ for its commercial banks. (more…)

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Authority Against Corruption demands impeachment of MPL.Gundalai and O.Chuluunbat.

Authority Against Corruption plans to propose a letter to the State Great Khural regarding to revoke the inspection of MP O.Chuluunbat and L.Gundalai. It was propsed to the State Great Khural 5 times for MP L.Gundalai. Crime related to MPs takes long to conclude. Therefore, in order to proceed the inspection this authority needs impeachment for these two MPs.

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О.Chuluunbat: The worst version can bring 1 billion US$ to Mongolia

MP O.Chuluunbat was interviewed regarding to the budget modification of year 2008 and general budget of year 2009.
Q: You said that the budget modification was quite impressive. What was the reasoning of your conclusion?
MP O.Chuluunbat: Because our budget was calculated without big loss. It is important for Mongolia.budget loss was 3-4% in the last 10 years and 5-6% in mid 90s. if there will be loss, then investors and even our domestic business community will conclude that this Government cannot manage its management. If you have 1000 MNT salary but you borrow 1100 or 1200 MNT from you friends, then this family has very poor management on money. Exactly like this, there was time that our budget management was poor. Therefore, I thought that this is very good proposal because it balances our budget. In order to attract big money from abroad, we shall pursue correct monetary and budget policy, according to the world market rule of business and investment. Then we will be appreciated by others. (more…)

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Interview with MP O.Chuluunbat: To become the factor that without Mongolian copper, the Chinese factories to be in trouble

Q: Inflation reached 33%. Can Bank of Mongolia and The Ministry of Finance take right measure to harness the inflation?

Chuluunbat: Yes, inflation reached 33%. Not only Bank of Mongolia is the guardian of inflation. Inflation is not because of sole policy of Mongol Bank, but it is fueled by budget policy. During the last two years, the budget expenditure has increased by 70%. It is over 100% including this year’s increase. Such big expense definitely accelerates the inflation. If the budget expense was devoted for the investment, then it won’t be like this. All expense was spent only for the pocket, therefore everybody spend their money in shops. In this sense, inflation was fueled by budget policy not by the policy of Bank Mongolia. The Bank of Mongolia is trying to harness the inflation, but measures don’t show any effect. The Bank of Mongolia has some other measures. It will probably talk with the Parliament and Government. (more…)

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O.Chuluunbat: We Are Importing Inflation

Inflation is related with the political decisions.

You are the product of the period when the professionals were produced according to the policy. When did you graduate, specializing in what major?

I studied at International Relations Institute of Moscow between 1976-1981, majoring in international economy, financial relations. My generation was educated during the centrally planned economy and under one party strict control. The State prepared me as the world financial expert and appointed in the currency clearance and administration of currency reserve of the Central Bank of Mongolia. I studied market economy so called market of capitalist world. I measured, made research and investigated about many financial relations of the market economy, such as why increase price of commodity, budget deficit occurs and so on. Finally, I understood the market and have my own view towards many operations and acts. Anyone will become same as me if study the market for many years. Then, between 1987-1991, I worked at the International Bank of Moscow. (more…)

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