The document summarizes major scams, irregularities, and heists in the Bangladeshi banking sector over the past decade. It details several instances where state-owned, private, and foreign commercial banks embezzled funds totaling billions of taka through fraudulent loans and money laundering. In response, the Anti-Corruption Commission filed cases against bank officials and borrowers, while the Bangladesh Bank appointed observers or conducted audits at troubled banks. Overall, widespread corruption and mismanagement have undermined the stability and performance of the banking sector.
The document provides an overview of the banking industry in Bangladesh. It discusses the structure of the banking sector, which includes state-owned commercial banks, private commercial banks, foreign commercial banks, and specialized banks. It also lists the major banks in each category and provides statistics on the total assets and deposits. Additionally, it gives a brief history of banking in Bangladesh and describes the roles of the central bank and commercial banks. It concludes with information on the growth of Islamic banking in the country.
Current & Future challenges of banking sector in bd(DBBL)University of Dhaka
The document discusses the current and future challenges facing the banking sector in Bangladesh and how banks can address those challenges. Some of the major challenges mentioned include low quality of assets, surplus liquidity, lack of good governance and transparency, inadequate risk management systems, and political and macroeconomic risks. Strategies that can help banks overcome these challenges involve improving risk management practices, strengthening governance, providing training to employees, using new technologies, and attracting and retaining customers. The document also provides a brief overview of Dutch-Bangla Bank Limited and how it creates value for customers through various deposit, loan and digital banking products and services.
This topic is for about Bangladesh bank industry.you can find out
why we invest on bank?
Investing on bank Risk or not?
which bank is prefer for investment?
what is our strategy management for banking industry?
Financial System and Banking Sector of BangladeshRabiul Islam
The document provides an overview of the financial system and banking sector of Bangladesh. It discusses the three sectors of the financial system - formal, semi-formal and informal. It then focuses on the banking sector, describing the various types of banks in Bangladesh such as state-owned commercial banks, private commercial banks, Islamic banks, and foreign commercial banks. It also outlines some of the challenges faced by the banking sector as well as the regulatory authorities and guidelines that govern banks in Bangladesh. In conclusion, the document gives a brief summary of key aspects of Bangladesh's financial landscape.
MCB Bank Limited is one of Pakistan's largest banks. It was founded in 1947 and privatized in 1991. Today it has over 1,173 branches across Pakistan and overseas. The document provides an overview of MCB's history, leadership, financial performance, products and services which include deposits, loans, credit cards, investments and more.
Credit risk @ sbi project report mba financeBabasab Patil
This document provides an executive summary and background of a project on credit risk management at State Bank of India. The objectives are to study the bank's structure, credit rating procedures, risk management activities, and regulatory guidelines. The methodology includes collecting primary data through interviews and secondary data from publications. Key findings are that SBI sanctions less agricultural credit than competitors and has effective risk management. Recommendations include revising credit policies, lowering interest rates, and increasing agricultural lending. The conclusion is that the project increased knowledge of credit policies and risk management.
Financial Performance Analysis Of Janata Bank LimitedHasnan Imtiaz
This document provides an overview and analysis of a report on the financial performance of Janata Bank Ltd. It begins with an introduction to the bank, describing its role in Bangladesh's economy and financial system. It then outlines the objectives, methodology and scope of the report, which includes analyzing Janata Bank's financial statements from 2009-2013 to identify strengths and weaknesses. The document provides context on the bank's background, objectives, and awards it has received. It describes the report's purpose as evaluating the bank's past financial performance to help inform management decision-making.
The document is an internship report submitted by Sehrish Khalid to the Faculty of Commerce & Accountancy at the University of Gujrat in partial fulfillment of the requirements for a Master's degree. The report details Sehrish Khalid's 6-week internship at the MCB Bank branch in Kutchery Road, Gujrat, where she gained experience in the bank's Remittances, Advances, Foreign Exchange, and Customer Service departments. The report includes chapters covering an introduction to MCB Bank, its history and operations, organizational structure, the intern's responsibilities and learning experiences, and conclusions and recommendations.
The document provides an overview of the banking industry in Bangladesh. It discusses the structure of the banking sector, which includes state-owned commercial banks, private commercial banks, foreign commercial banks, and specialized banks. It also lists the major banks in each category and provides statistics on the total assets and deposits. Additionally, it gives a brief history of banking in Bangladesh and describes the roles of the central bank and commercial banks. It concludes with information on the growth of Islamic banking in the country.
Current & Future challenges of banking sector in bd(DBBL)University of Dhaka
The document discusses the current and future challenges facing the banking sector in Bangladesh and how banks can address those challenges. Some of the major challenges mentioned include low quality of assets, surplus liquidity, lack of good governance and transparency, inadequate risk management systems, and political and macroeconomic risks. Strategies that can help banks overcome these challenges involve improving risk management practices, strengthening governance, providing training to employees, using new technologies, and attracting and retaining customers. The document also provides a brief overview of Dutch-Bangla Bank Limited and how it creates value for customers through various deposit, loan and digital banking products and services.
This topic is for about Bangladesh bank industry.you can find out
why we invest on bank?
Investing on bank Risk or not?
which bank is prefer for investment?
what is our strategy management for banking industry?
Financial System and Banking Sector of BangladeshRabiul Islam
The document provides an overview of the financial system and banking sector of Bangladesh. It discusses the three sectors of the financial system - formal, semi-formal and informal. It then focuses on the banking sector, describing the various types of banks in Bangladesh such as state-owned commercial banks, private commercial banks, Islamic banks, and foreign commercial banks. It also outlines some of the challenges faced by the banking sector as well as the regulatory authorities and guidelines that govern banks in Bangladesh. In conclusion, the document gives a brief summary of key aspects of Bangladesh's financial landscape.
MCB Bank Limited is one of Pakistan's largest banks. It was founded in 1947 and privatized in 1991. Today it has over 1,173 branches across Pakistan and overseas. The document provides an overview of MCB's history, leadership, financial performance, products and services which include deposits, loans, credit cards, investments and more.
Credit risk @ sbi project report mba financeBabasab Patil
This document provides an executive summary and background of a project on credit risk management at State Bank of India. The objectives are to study the bank's structure, credit rating procedures, risk management activities, and regulatory guidelines. The methodology includes collecting primary data through interviews and secondary data from publications. Key findings are that SBI sanctions less agricultural credit than competitors and has effective risk management. Recommendations include revising credit policies, lowering interest rates, and increasing agricultural lending. The conclusion is that the project increased knowledge of credit policies and risk management.
Financial Performance Analysis Of Janata Bank LimitedHasnan Imtiaz
This document provides an overview and analysis of a report on the financial performance of Janata Bank Ltd. It begins with an introduction to the bank, describing its role in Bangladesh's economy and financial system. It then outlines the objectives, methodology and scope of the report, which includes analyzing Janata Bank's financial statements from 2009-2013 to identify strengths and weaknesses. The document provides context on the bank's background, objectives, and awards it has received. It describes the report's purpose as evaluating the bank's past financial performance to help inform management decision-making.
The document is an internship report submitted by Sehrish Khalid to the Faculty of Commerce & Accountancy at the University of Gujrat in partial fulfillment of the requirements for a Master's degree. The report details Sehrish Khalid's 6-week internship at the MCB Bank branch in Kutchery Road, Gujrat, where she gained experience in the bank's Remittances, Advances, Foreign Exchange, and Customer Service departments. The report includes chapters covering an introduction to MCB Bank, its history and operations, organizational structure, the intern's responsibilities and learning experiences, and conclusions and recommendations.
This presentation provides an overview of the banking industry in Bangladesh. It discusses the historical background of banking after independence, including the six commercial banks and three foreign banks established. It also outlines the current state of the industry, including state-owned commercial banks, private commercial banks, foreign commercial banks and specialized banks. Key points about the Central Bank of Bangladesh and functions of commercial banks are summarized. The presentation also discusses Islamic banks, specialized banks, developments in the sector like e-banking and mobile banking, and challenges faced by the banking industry in Bangladesh such as an underdeveloped business environment.
National bank of Pakistan (nbp) swot analysisiqra ishfaq
The document analyzes the SWOT of National Bank of Pakistan. Some key strengths include being the first nationalized commercial bank, having a large branch network of over 1200 domestic and 22 overseas branches, and providing services like ATMs, online banking, and acting as an agent for the state bank. Weaknesses include less computerization, uneven work distribution, and favoritism in recruitment. Opportunities lie in growing the banking system through technology adoption. Threats include new competitors providing better services, customer dissatisfaction, outdated systems, and political pressure.
The document provides an internship report on the general banking activities of Southeast Bank Limited. It discusses the bank's organization overview including its mission, vision, and objectives. It also analyzes the bank's strengths, weaknesses, opportunities, and threats through a SWOT analysis. The report describes the bank's general banking functions like account opening, cash receipt/payment, clearing activities. It finds that while the bank has experienced employees and cooperative environment, it lacks manpower, computer knowledge, and training. It provides recommendations like expanding online banking, increasing manpower and marketing to attract more customers.
The document is a project report submitted by Rajesh Kumar to the National Institute of Technology on retail banking with reference to Allahabad Bank. It includes an executive summary, introduction, company and industry profiles, data collection methodology, findings, suggestions and conclusions. The report analyzes various aspects of Allahabad Bank's retail banking operations including its products and services, workflow, McKinsey's 7S framework, research methodology and customer feedback.
internship report on Credit management policy of janata BankMd. Shohel Rana
This document is an internship report submitted by Muhammad Belal Uddin on the credit management policy and performance analysis of Janata Bank Limited's Lalbagh Branch in Rangpur. It includes an introduction, organizational profile of Janata Bank, an overview of the Lalbagh branch, description of the intern's work areas, analysis of Janata Bank's credit management policy and performance, and findings and recommendations. The report was prepared as part of BBA program requirements and provides insight into Janata Bank's lending practices and financial performance based on the intern's three-month experience at the Lalbagh branch.
Causes of Non-Performing Loan: A Study on State Owned Commercial Bank of Bang...Dhaka university
Research Objectives and Possible Research Questions, Classified Loan, Theories: Ethical theory, Moral Hazard, Political Power, Transaction Cost, Stakeholder, Conceptual framework, Research Position, References and Reviewed Literature
Agrani Bank Limited is a leading commercial bank in Bangladesh with over 900 branches. It was established in 1972 after Bangladesh gained independence, taking over assets and liabilities of Habib Bank and Commerce Bank. Over the years, the bank has expanded significantly in terms of branches, deposits, loans, and other key indicators. The bank aims to provide high quality customer service and support Bangladesh's socio-economic development through various financing programs.
OBJECTIVE
Global economic activity has come to a near standstill as Covid-19 related lockdowns are imposed across a widening swathe of affected countries. Financial markets have been facing high volatility due to panic sell-offs resulting in destruction of equity markets. Financial institutions have started encountering liquidity constraints and lags in credit flow, thereby putting debt servicing at risk. The need for strong fiscal measures has become the voice of the banking sector to revive. In this webinar, we shall be focusing on the various spheres of the banking sector which has the hard hit due to the pandemic’s intensity, the RBI’s measures to cope up with the current slack and the way forward for revival of the coveted sector.
The document summarizes the departmental structure of the State Bank of Pakistan and the life cycle and management of bank notes in Pakistan. It outlines the key departments involved, including the Issue Department, Cash Department, and Pakistan Security Printing Corporation. It also describes the process that bank notes go through, from indent and production to circulation, sorting, and destruction. The document concludes with recommendations around public awareness, discouraging informal currency exchanges, and discouraging black markets.
This document provides an overview of monetary policy through 7 chapters. It begins with an introduction and outlines the objectives, methodology and limitations of the report. Chapter 2 defines monetary policy and provides a history and overview of its scope, objectives and tools. Chapter 3 discusses the transmission mechanism of monetary policy through interest rates and financial markets. Chapter 4 examines the impacts of monetary policy on capital markets and inflation. Chapter 5 analyzes Bangladesh's monetary policy strategy, instruments and challenges. Chapter 6 concludes with an advocacy perspective on monetary policy in Bangladesh.
ECONOMIC AND FINANCIAL ANALYSIS OF SBI AND BOB Jeetu Matta
This document provides an analysis of State Bank of India (SBI) and Bank of Baroda (BOB). It begins with an executive summary that outlines the objectives of the analysis, which are to examine different government norms, functions, risks, and strategies related to commercial banking in India. It also aims to analyze how economic issues affect the Indian banking sector. The document then provides detailed information on the introduction and functions of banks in India, types of bank accounts, an introduction to SBI and BOB, comparative analysis of banks and non-banking financial institutions, impact of mergers on cost efficiency, government policies related to SBI and BOB, risk management, effects of inflation on commercial banks, data analysis through financial ratios
Credit appraisal in sbi bank project6 report Babasab Patil
The document discusses the banking sector in India. It notes that the Reserve Bank of India closely monitors the financial sector, which is dominated by scheduled commercial banks including public, private, foreign, and regional rural banks. It then focuses on providing details about the State Bank of India, noting that it is the largest bank in India with over 8,500 branches and that it is undergoing changes to modernize and expand its services to compete better. The document also provides a brief overview of the classification and reforms of the banking system in India.
HDFC Bank Financial Analysis & Industry Comparison 2017Harsh Bohra
Content of this presentation includes Indian Banking Industry Structure, Bank classification in India, Growth of Public & Private Sector Banks in India, Bank Credit & Systemic Credit, Financial Analysis including CASA Ratio, Gross and Net NPA's, ATMs and Branches penetration comparison of HDFC Bank with State Bank of India, Bank of Baroda, ICICI Bank, AXIS Bank and Canara Bank, Deposits & Advances, Interest Incomes & Expanded, Business Model of HDFC Bank, Merger & Acquisition and Revenue Stream and Expansion Plans.
Meezan Bank is Pakistan's first and largest Islamic bank. It has expanded rapidly, growing its branch network to 201 branches across 54 cities. Total deposits have increased 43% to over Rs. 100 billion as of 2009. The bank aims to establish Islamic banking as the preferred system through innovative Shariah-compliant products and services while optimizing stakeholder value. It has a highly qualified Shariah board and seeks to find common ground with conventional banking within Islamic principles.
This document provides background information on Allied Bank Limited (ABL) in Pakistan. It discusses the early development of banking in Pakistan after independence, with very few branches and most resources controlled by non-Muslim bankers who left for India. The State Bank of Pakistan was established in 1948 as the central bank. ABL was the first Muslim bank established in the territory of Pakistan in 1942. The document outlines the objectives and methodology of a study conducted on ABL's operations and performance. It discusses the importance of banks in mobilizing savings and providing finance to drive economic growth. It also briefly traces the history of banking from merchants and goldsmiths to the establishment of modern commercial banks in Pakistan.
The document discusses various topics related to commercial banking including:
1. It defines what a bank is and its key functions of accepting deposits and lending funds.
2. It describes different types of banking systems used around the world such as branch banking, unit banking, and corresponding banking.
3. It provides an overview of the largest banks in the world by total assets, with the top 5 being in China.
4. It outlines the main sources of funds for banks such as deposits, borrowed funds, and long-term sources. It also discusses the main uses of funds such as loans, investments, and cash.
Capital adequacy measures a bank's capital reserves relative to its risk-weighted assets and activities. It aims to ensure banks can absorb reasonable losses without becoming insolvent. The Basel Committee on Banking Supervision, formed in 1974 under the Bank for International Settlements, establishes capital adequacy standards known as the Basel Accords. Basel I covered only credit risk while Basel II and III expanded coverage of risks and strengthened requirements on capital, liquidity and leverage to promote banking sector and financial stability.
A study of non performing assets with special reference to icici bankShami Zama
The document discusses non-performing assets (NPAs) in the Indian banking system. It defines an NPA as a loan or advance that is overdue for repayment by 90 days or more. Key factors influencing NPAs include failure of borrowers to repay loans on time, resulting in losses for banks. High levels of NPAs negatively impact bank profitability. While some NPAs are inevitable, banks aim to maintain low NPA levels to remain sustainable. Various measures have been taken to reduce the growing problem of NPAs, but more work is still needed to effectively solve this issue facing the Indian banking sector.
Non-performing assets (NPAs) in the Indian banking system have significantly increased in recent years. NPAs totaled around 2.5 lakh crores (approximately $37 billion) by the end of March 2015, equal to the budget of the state of Uttar Pradesh. State-run banks account for two-thirds of total loans but 80% of bad assets. Rising NPAs hurt bank profitability, constrain new lending, and undermine public confidence in the banking system if left unaddressed. The majority of the increased NPAs have occurred in public sector banks that extensively lent to corporates between the early 2000s and 2008; many of these companies subsequently struggled amid a global slowdown.
RBSA Advisors Research Report - The Big Bank TheoryRBSA Advisors
The document discusses the need for consolidation of public sector banks in India through mergers and acquisitions. It notes that Indian banks are much smaller compared to the size of the Indian economy, and that no Indian bank ranks among the top 50 banks globally in terms of total assets. Consolidation could help create larger banks that have scale advantages, better manage stressed assets, lower costs through synergies, and better support large infrastructure projects needed in India. However, consolidation also faces challenges including opposition from bank unions, integrating different bank IT systems, and the poor financial health of some public sector banks.
This presentation provides an overview of the banking industry in Bangladesh. It discusses the historical background of banking after independence, including the six commercial banks and three foreign banks established. It also outlines the current state of the industry, including state-owned commercial banks, private commercial banks, foreign commercial banks and specialized banks. Key points about the Central Bank of Bangladesh and functions of commercial banks are summarized. The presentation also discusses Islamic banks, specialized banks, developments in the sector like e-banking and mobile banking, and challenges faced by the banking industry in Bangladesh such as an underdeveloped business environment.
National bank of Pakistan (nbp) swot analysisiqra ishfaq
The document analyzes the SWOT of National Bank of Pakistan. Some key strengths include being the first nationalized commercial bank, having a large branch network of over 1200 domestic and 22 overseas branches, and providing services like ATMs, online banking, and acting as an agent for the state bank. Weaknesses include less computerization, uneven work distribution, and favoritism in recruitment. Opportunities lie in growing the banking system through technology adoption. Threats include new competitors providing better services, customer dissatisfaction, outdated systems, and political pressure.
The document provides an internship report on the general banking activities of Southeast Bank Limited. It discusses the bank's organization overview including its mission, vision, and objectives. It also analyzes the bank's strengths, weaknesses, opportunities, and threats through a SWOT analysis. The report describes the bank's general banking functions like account opening, cash receipt/payment, clearing activities. It finds that while the bank has experienced employees and cooperative environment, it lacks manpower, computer knowledge, and training. It provides recommendations like expanding online banking, increasing manpower and marketing to attract more customers.
The document is a project report submitted by Rajesh Kumar to the National Institute of Technology on retail banking with reference to Allahabad Bank. It includes an executive summary, introduction, company and industry profiles, data collection methodology, findings, suggestions and conclusions. The report analyzes various aspects of Allahabad Bank's retail banking operations including its products and services, workflow, McKinsey's 7S framework, research methodology and customer feedback.
internship report on Credit management policy of janata BankMd. Shohel Rana
This document is an internship report submitted by Muhammad Belal Uddin on the credit management policy and performance analysis of Janata Bank Limited's Lalbagh Branch in Rangpur. It includes an introduction, organizational profile of Janata Bank, an overview of the Lalbagh branch, description of the intern's work areas, analysis of Janata Bank's credit management policy and performance, and findings and recommendations. The report was prepared as part of BBA program requirements and provides insight into Janata Bank's lending practices and financial performance based on the intern's three-month experience at the Lalbagh branch.
Causes of Non-Performing Loan: A Study on State Owned Commercial Bank of Bang...Dhaka university
Research Objectives and Possible Research Questions, Classified Loan, Theories: Ethical theory, Moral Hazard, Political Power, Transaction Cost, Stakeholder, Conceptual framework, Research Position, References and Reviewed Literature
Agrani Bank Limited is a leading commercial bank in Bangladesh with over 900 branches. It was established in 1972 after Bangladesh gained independence, taking over assets and liabilities of Habib Bank and Commerce Bank. Over the years, the bank has expanded significantly in terms of branches, deposits, loans, and other key indicators. The bank aims to provide high quality customer service and support Bangladesh's socio-economic development through various financing programs.
OBJECTIVE
Global economic activity has come to a near standstill as Covid-19 related lockdowns are imposed across a widening swathe of affected countries. Financial markets have been facing high volatility due to panic sell-offs resulting in destruction of equity markets. Financial institutions have started encountering liquidity constraints and lags in credit flow, thereby putting debt servicing at risk. The need for strong fiscal measures has become the voice of the banking sector to revive. In this webinar, we shall be focusing on the various spheres of the banking sector which has the hard hit due to the pandemic’s intensity, the RBI’s measures to cope up with the current slack and the way forward for revival of the coveted sector.
The document summarizes the departmental structure of the State Bank of Pakistan and the life cycle and management of bank notes in Pakistan. It outlines the key departments involved, including the Issue Department, Cash Department, and Pakistan Security Printing Corporation. It also describes the process that bank notes go through, from indent and production to circulation, sorting, and destruction. The document concludes with recommendations around public awareness, discouraging informal currency exchanges, and discouraging black markets.
This document provides an overview of monetary policy through 7 chapters. It begins with an introduction and outlines the objectives, methodology and limitations of the report. Chapter 2 defines monetary policy and provides a history and overview of its scope, objectives and tools. Chapter 3 discusses the transmission mechanism of monetary policy through interest rates and financial markets. Chapter 4 examines the impacts of monetary policy on capital markets and inflation. Chapter 5 analyzes Bangladesh's monetary policy strategy, instruments and challenges. Chapter 6 concludes with an advocacy perspective on monetary policy in Bangladesh.
ECONOMIC AND FINANCIAL ANALYSIS OF SBI AND BOB Jeetu Matta
This document provides an analysis of State Bank of India (SBI) and Bank of Baroda (BOB). It begins with an executive summary that outlines the objectives of the analysis, which are to examine different government norms, functions, risks, and strategies related to commercial banking in India. It also aims to analyze how economic issues affect the Indian banking sector. The document then provides detailed information on the introduction and functions of banks in India, types of bank accounts, an introduction to SBI and BOB, comparative analysis of banks and non-banking financial institutions, impact of mergers on cost efficiency, government policies related to SBI and BOB, risk management, effects of inflation on commercial banks, data analysis through financial ratios
Credit appraisal in sbi bank project6 report Babasab Patil
The document discusses the banking sector in India. It notes that the Reserve Bank of India closely monitors the financial sector, which is dominated by scheduled commercial banks including public, private, foreign, and regional rural banks. It then focuses on providing details about the State Bank of India, noting that it is the largest bank in India with over 8,500 branches and that it is undergoing changes to modernize and expand its services to compete better. The document also provides a brief overview of the classification and reforms of the banking system in India.
HDFC Bank Financial Analysis & Industry Comparison 2017Harsh Bohra
Content of this presentation includes Indian Banking Industry Structure, Bank classification in India, Growth of Public & Private Sector Banks in India, Bank Credit & Systemic Credit, Financial Analysis including CASA Ratio, Gross and Net NPA's, ATMs and Branches penetration comparison of HDFC Bank with State Bank of India, Bank of Baroda, ICICI Bank, AXIS Bank and Canara Bank, Deposits & Advances, Interest Incomes & Expanded, Business Model of HDFC Bank, Merger & Acquisition and Revenue Stream and Expansion Plans.
Meezan Bank is Pakistan's first and largest Islamic bank. It has expanded rapidly, growing its branch network to 201 branches across 54 cities. Total deposits have increased 43% to over Rs. 100 billion as of 2009. The bank aims to establish Islamic banking as the preferred system through innovative Shariah-compliant products and services while optimizing stakeholder value. It has a highly qualified Shariah board and seeks to find common ground with conventional banking within Islamic principles.
This document provides background information on Allied Bank Limited (ABL) in Pakistan. It discusses the early development of banking in Pakistan after independence, with very few branches and most resources controlled by non-Muslim bankers who left for India. The State Bank of Pakistan was established in 1948 as the central bank. ABL was the first Muslim bank established in the territory of Pakistan in 1942. The document outlines the objectives and methodology of a study conducted on ABL's operations and performance. It discusses the importance of banks in mobilizing savings and providing finance to drive economic growth. It also briefly traces the history of banking from merchants and goldsmiths to the establishment of modern commercial banks in Pakistan.
The document discusses various topics related to commercial banking including:
1. It defines what a bank is and its key functions of accepting deposits and lending funds.
2. It describes different types of banking systems used around the world such as branch banking, unit banking, and corresponding banking.
3. It provides an overview of the largest banks in the world by total assets, with the top 5 being in China.
4. It outlines the main sources of funds for banks such as deposits, borrowed funds, and long-term sources. It also discusses the main uses of funds such as loans, investments, and cash.
Capital adequacy measures a bank's capital reserves relative to its risk-weighted assets and activities. It aims to ensure banks can absorb reasonable losses without becoming insolvent. The Basel Committee on Banking Supervision, formed in 1974 under the Bank for International Settlements, establishes capital adequacy standards known as the Basel Accords. Basel I covered only credit risk while Basel II and III expanded coverage of risks and strengthened requirements on capital, liquidity and leverage to promote banking sector and financial stability.
A study of non performing assets with special reference to icici bankShami Zama
The document discusses non-performing assets (NPAs) in the Indian banking system. It defines an NPA as a loan or advance that is overdue for repayment by 90 days or more. Key factors influencing NPAs include failure of borrowers to repay loans on time, resulting in losses for banks. High levels of NPAs negatively impact bank profitability. While some NPAs are inevitable, banks aim to maintain low NPA levels to remain sustainable. Various measures have been taken to reduce the growing problem of NPAs, but more work is still needed to effectively solve this issue facing the Indian banking sector.
Non-performing assets (NPAs) in the Indian banking system have significantly increased in recent years. NPAs totaled around 2.5 lakh crores (approximately $37 billion) by the end of March 2015, equal to the budget of the state of Uttar Pradesh. State-run banks account for two-thirds of total loans but 80% of bad assets. Rising NPAs hurt bank profitability, constrain new lending, and undermine public confidence in the banking system if left unaddressed. The majority of the increased NPAs have occurred in public sector banks that extensively lent to corporates between the early 2000s and 2008; many of these companies subsequently struggled amid a global slowdown.
RBSA Advisors Research Report - The Big Bank TheoryRBSA Advisors
The document discusses the need for consolidation of public sector banks in India through mergers and acquisitions. It notes that Indian banks are much smaller compared to the size of the Indian economy, and that no Indian bank ranks among the top 50 banks globally in terms of total assets. Consolidation could help create larger banks that have scale advantages, better manage stressed assets, lower costs through synergies, and better support large infrastructure projects needed in India. However, consolidation also faces challenges including opposition from bank unions, integrating different bank IT systems, and the poor financial health of some public sector banks.
RBL Bank is one of the fast growing private banks in India. A detailed general environment analysis(PESTEL), Industry analysis(Porter's 5 forces), VRIO analysis carried to look at the strategy analysis and formulated strategy for different business verticals, as part of the Project in MBA
The document summarizes key concerns and outlook for banks in Indonesia based on meetings with banks and companies during a recent trip to Indonesia. The top three concerns expressed by banks are: 1) currency volatility due to the rupiah's large depreciation, 2) increasing regulatory intervention, and 3) potential delays in government spending if the tax revenue target is missed. Large banks are expected to see slowing earnings growth while smaller banks should see a recovery as margins improve and credit costs stabilize. Among smaller banks, BTPN is the preferred pick.
The Reserve Bank of India kicked off a gradual interest rate hike cycle by raising its key repo rate by 25 basis points to 6.25% amid a global market rout. This comes as the RBI joins other central banks like Indonesia, Turkey and Argentina in tightening monetary policy. Indian bonds slipped in response to the rate hike while the rupee advanced. Foreigners dumped $12.3 billion of emerging market assets in May according to the Institute of International Finance, reflecting rising global borrowing costs, a stronger dollar and deteriorating sentiment across many emerging markets.
The document provides an overview of the Indian banking industry. It discusses key trends such as rising credit growth, increasing assets and money supply, and growing interest income. Technology innovations and policy support are driving factors for future banking sector expansion. However, non-performing assets pose a risk, which regulators are taking steps like debt resolution plans and enhanced KYC checks to mitigate. Overall the market outlook for Indian banks remains positive due to continued economic growth, infrastructure investments, and banks' focus on new technologies.
What are the Stimulating Factors Affecting NPL in Banking Sector of Banglades...ijtsrd
A well organized, well structured and developed financial sector ensures efficient allocation of financial resources and perks up the competitiveness of the private sector, thereby promoting investment and growth in the real sector. The thrust of the development is to improve the regulatory and governance environment and to enhance the ability of bank owners, management and regulators, and the markets themselves to provide for better governance and regulation to achieve the objectives. In this perspective, improvement of the situation of non performing loan is important. A high volume of non performing loan can never be a boon for the economy. Credit to economy is the main source for financial support of business. On the other side, banks have limited investment tools for their deposits. This study present results from an econometric analysis, favorably Random Effect Model, using pooled panel data collected from the central bank of Bangladesh categorizing four sectors of banking based on the pattern of ownership. Based on the analysis of the bank specific microeconomic factors, which are selected on the availability from reliable sources, used as the regressors, it is observed that the liquidity and the management soundness is more significantly affect the Non performing loan NPL in Bangladesh. Therefore, the recommendation is placed towards formulation policy instruments in favor of solvency rather liquidity. In addition to that, the improvement of managerial efficiency must be sought as well. Ratna Biswas | Mohammed Nazrul Islam | Chanu Gopal Ghosh ""What are the Stimulating Factors Affecting NPL in Banking Sector of Bangladesh? Evidence from Econometric Exercises"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-2 , February 2020, URL: https://www.ijtsrd.com/papers/ijtsrd29861.pdf
Paper Url : https://www.ijtsrd.com/economics/financial-economics/29861/what-are-the-stimulating-factors-affecting-npl-in-banking-sector-of-bangladesh-evidence-from-econometric-exercises/ratna-biswas
July 2014 Edition of BEACON, A Monthly Newsletter by SIMCON.
Inside this issue:
INDUSTRY ANALYSIS :Banking Industry
COMPANY ANALYSIS : ICICI Bank
Concept of the Month
Quiz
Did You Know?
presentation of Saima binte yusuf of patuakhali.pptxsyedrayhan000
This document contains a presentation on the credit management of Dhaka Bank Limited. It begins with welcoming remarks and introduces the presenter and topic of the presentation. The presentation objectives are to analyze the theoretical aspects and procedures of Dhaka Bank's credit management and conduct a comparative performance analysis. It will utilize secondary data sources and analytical tools like trend and comparative analysis. An overview of Dhaka Bank provides background before examining credit types, management processes, and comparative performance metrics like loans over time. Major findings note trends in credit disbursement and classified loans. Recommendations include maintaining growth, diversifying lending sectors and regions, and controlling non-performing loans.
Bandhan started as Bandhan Konnagar in 2001 as a non-governmental organisation
(NGO) providing microfinance services to socially and economically disadvantaged
women in rural West Bengal. Bandhan Financial Services (BFSL) started its microfinance
business in 2006. The NGO transferred its microfinance business to BFSL in 2009. Thus,
the entire microfinance business was undertaken by BFSL from 2009.
Weaker Corporate Balance sheet and its implication Mohit Kumar
This presentation will give information about weak and twin balance sheet of company. What twin balance sheet is and any balance sheet is called weak balance sheet.
In this project, I have covered the trend analysis of different banks and NBFC'S on the basis of different parameters. The total project concludes with buy and sells option for the firms according to the resistance and support level and the price at which they have to trade.
- Yes Bank is an Indian private sector bank that has grown to become the 4th largest private bank in India. It has over 600 branches with a focus in Northern and Western India.
- The document recommends Yes Bank as a strong buy due to its strong financials, shift towards a retail-led strategy that will boost profit margins, and potential interest rate cuts that will support loan growth.
- Yes Bank has successfully increased its lower-cost current and savings account deposits while maintaining strong asset quality and profitability. It is poised for further growth as it expands its retail presence.
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Banking sector in bangladesh moving from diagnosis to action
1. Banking Sector in Bangladesh:
Moving from
Diagnosis to Action
Fahmida Khatun
Executive Director
Centre for Policy Dialogue (CPD)
Dhaka: 8 December 2018
2. 2
Acknowledgement
Team Members
- Fahmida Khatun, Executive Director
- Syed Yusuf Saadat, Research Associate
- Shamila Sarwar, Programme Associate
- Fahmid Tawsif Khan Chowdhury, Research Intern
The report has been prepared with substantive inputs from Dr Shah Md. Ahsan Habib,
Professor, BIBM.
Sincere thanks to Dr Debapriya Bhattacharya, Distinguished Fellow, CPD, Professor
Mustafizur Rahman, Distinguished Fellow, CPD, Dr Khondoker Golam Moazzem,
Research Director, CPD and Mr Towfiqul Islam Khan, Senior Research Fellow, CPD for
their suggestions.
The authors have also benefitted from participants of an expert group consultation.
4. 4
1.1 Context
• The banking sector of Bangladesh has expanded over the years in
terms of number of formal institutions, higher number of financing
instruments, and bigger volumes of assets.
• However, the sector has been facing a number of serious challenges
due to malpractices, scams and heists.
• These have affected the overall performance of the sector which are
reflected through various efficiency and soundness indicators.
• Repeated concerns have been expressed by relevant stakeholders
regarding the constant deterioration of banking performances and its
potential implications for the sustainability of the sector.
• Given that the financial sector of the country is mainly bank based,
poor health of the banking sector will also impact on economic
growth. Therefore, fixing the problems are critically important.
• While much has been talked about, it is time to act to address the
problems. For the next government, the banking sector should be a
priority for action.
5. 5
1.2 Objectives
As the country prepares for the national elections on 30 December 2018,
CPD felt the need to bring the issues of banking sector performances to
the notice of the political parties. CPD has been continuously flagging
the issue for many years. The broad objective of this study is to revisit
the major challenges in the banking sector during the past decade and
make suggestions to act upon those.
Specific research questions are:
• What has been the performance of the sector across major indicators?
• What policy and institutional measures have been taken to improve
governance in the banking industry and what are their outcomes?
• How conducive the role the central bank is in ensuring sound
governance of the banking system
• Which should be the priority areas for the next government to
overcome the challenges of the banking sector?
The study is mainly based on secondary information. A number of
experts have been consulted in order to understand the dynamics of the
sector and related problems and how to move forward.
7. • Bangladesh Bank’s Guidelines
on Risk Based Capital
Adequacy (2014) state that
banks in Bangladesh must
maintain a minimum total
capital ratio of 10% (or
Minimum Total Capital plus
Capital Conservation Buffer of
12.5%) by 2019, in line with
BASEL III.
• State-owned commercial banks
(SCBs) have failed to maintain
minimum capital adequacy
requirements since 2013.
• Development finance
institutions (DFIs) are critically
under-capitalised.
7
2.1 Capital Adequacy Status
Figure 1: Capital to Risk Weighted Assets Ratio
Source: Bangladesh Bank
Note: Data for 2017 and 2018 are as of June
-40
-30
-20
-10
0
10
20
30
40
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Percent
SCB DFI PCB FCB
8. • Both BASIC Bank and
ICB Islamic Bank are
critically under-
capitalised.
• BASIC Bank has not
recovered from its
massive scam during
2009-2013
• ICB Islamic Bank
inherited a bankrupt
institution from
Oriental Bank, although
all its problems are not
hereditary
8
2.2 Capital Adequacy Problems of
Banks
Figure 2: Capital to Risk Weighted Assets Ratio in BASIC
Bank & ICB Islamic Bank
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
-15.6
-108.5
-11
-115.7
-12
-115.8
-140
-120
-100
-80
-60
-40
-20
0
BASIC Bank Limited ICB Islami Bank
Limited
Percent
2016 2017 2018
9. • Non-performing loans
(NPL) as a share of total
loans is exceptionally
high in SCBs and DFIs.
• As of June 2018, SCBs
had 28.2% NPL, which is
highest in the last ten
years.
• About 47% non-
performing loans were
concentrated in 5 banks
as of end-June 2018
(BB, 2018).
9
2.3 Non-performing Loans
Figure 3: Non-performing Loans as a Share of Total Loans
Source: Bangladesh Bank
Note: Data for 2017 and 2018 are as of June
0
5
10
15
20
25
30
35
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Percent
SCB DFI PCB FCB
10. • Classified loans as a share
of total loans was more
than 10% for 9 banks
during 2016-2018.
• ICB Islamic Bank had
more than 60% and BASIC
Bank had more than 50%
classified loans during
2016-2018.
• The actual percentage of
classified loans would be
higher if loans were not
written off.
10
2.4 Asset Quality of Banks
Figure 4: Classified Loans as a Share of Total Loans
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
0 20 40 60 80 100
Sonali Bank Limited
Janata Bank Limited
Agrani Bank Limited
Rupali Bank Limited
BASIC Bank Limited
Bangladesh Development
Bank Limited
ICB Islami Bank Limited
Bangladesh Commerce
Bank Limited
The Farmers Bank
Limited
Per cent
2016 2017 2018
11. • During 2016-2018, all
SCBs had expenditure-
income ratios greater
than 0.5.
• This reveals poor
management
effectiveness of these
banks during this
period.
11
2.5 Management of State-Owned
Commercial Banks
Figure 5: Expenditure-Income Ratio of State-Owned
Commercial Banks
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
0 0.5 1 1.5
Sonali Bank Limited
Janata Bank Limited
Agrani Bank Limited
Rupali Bank Limited
BASIC Bank Limited
Bangladesh Development
Bank Limited
2016 2017 2018
12. • In terms of Return on
Asset (ROA) and Return
on Equity (ROE), the
performance of FCBs,
PCBs, and FCBs
deteriorated.
• As of June 2018, ROA and
ROE of the banking
industry stood 0.3% and
5.3% respectively.
• However, performance of
FCBs and PCBs were much
better as compared to that
of SCBs during 2008-
2017.
12
2.6 Return on Asset & Equity
Figure 6: Return on Asset
Source: Bangladesh Bank
Note: Data for 2017 and 2018 are as of June
-8
-6
-4
-2
0
2
4
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Percent
SCB PCB FCB
-30
-20
-10
0
10
20
30
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Percent
SCB PCB FCB
Figure 7: Return on Equity
13. • ICB Islamic Bank and
The Farmers Bank have
been making losses in
the last 3 years.
• BASIC Bank, Rupali
Bank, and Agrani Bank
made huge losses in
2016.
• However, losses made
by BASIC Bank alone
was greater than the
losses of all other banks
combined.
13
2.7 Loss Making Banks
Figure 8: Net Profit (in million BDT)
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
228
248
90
19
-998
6889
498
-6709
-405
-540
-6970
-1258
-14930
-271
229
-20000 -10000 0 10000
Agrani Bank Limited
Rupali Bank Limited
BASIC Bank Limited
ICB Islami Bank
Limited
The Farmers Bank
Limited
Million BDT
2016 2017 2018
14. • A fluctuating Advance-
Deposit Ratio (ADR)
was observed over the
last ten years
• This indicates
inefficiency in liquidity
management of some
banks
• During last few years,
the banking industry
faced more than two
unusual incidences of
both liquidity surpluses
and liquidity shortages
14
2.8 Liquidity Management
Figure 9: Advance-Deposit Ratio of Banks
Source: Bangladesh Bank
Note: Data for 2018 is as of June
78
75
76
78
79
73
73 73
72
74
77
66
68
70
72
74
76
78
80
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Percent
15. • Fourth generation banks such
as The Farmers Bank, NRB
Global Bank, and NRB
Commercial Bank faced
liquidity crisis during 2016-
2017.
• The problem was particularly
acute in the case of The
Farmers Bank, which had to be
bailed out by the government.
• In May 2018, four state-owned
banks and a financial
institution signed share
purchase agreements with The
Farmers Bank to inject BDT 765
crore into the bank (The Daily
Star, 2018).
15
2.9 Liquidity Crisis in Banks
Figure 10: Liquid Assets as a Share of Total Assets
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
-5.4
-0.9
0.6 0.2
-7.3
-17.1
0.4 0.1
2.4
1.8
0.4 0.4
-20.0
-15.0
-10.0
-5.0
0.0
5.0
Mercantile
Bank
Limited
The
Farmers
Bank
Limited
NRB Global
Bank
Limited
NRB
Commercial
Bank
Limited
Percent
2016 2017 2018
16. • 9 banks consistently
maintained an
interest rate spread
greater than 5%
during 2016-2018
• While some of these
were troubled banks,
others were simply
taking advantage of
lax regulations
16
2.10 Interest Rate Spread
Figure 11: Interest Rate Spread
Source: Financial Institutions Division, Ministry of Finance
Note: Data for 2018 are as of June
0 2 4 6 8 10 12
Bangladesh Development Bank
Limited
ICB Islami Bank Limited
Dutch Bangla Bank Limited
BRAC Bank Limited
NRB Global Bank Limited
Standard Chartered Bank
National Bank of Pakistan
Woori Bank
HSBC
Per cent
2016 2017 2018
18. 18
3.1 Scams, Irregularities and Heists
(contd...)
Bank/
Institution
Involved
Scam Measures
Sonali, Janata,
NCC,
Mercantile and
Dhaka Bank
(2008 -2011)
Bank loan of BDT 5.89 crores
with forged land documents
(Dhaka Tribune, 28th August,
2013)
On August 1st 2013, the ACC
filed cases against Sonali
Bank, Fahim Attire Limited
and some individuals. (Dhaka
Tribune, 2nd August, 2013)
BASIC Bank
(2009-2013)
Embezzlement of BDT 4,500
crores through fake companies
and dubious accounts.
(The Daily Star, 28th June, 2013)
In September 2015, the ACC
filed 56 cases against 120
people on charge of swindling.
(New Age Bangladesh, 13th
August, 2018)
19. 19
3.1 Scams, Irregularities and Heists
(contd...)
Bank/ Institution
Involved
Scam Measures
Sonali Bank
(2010-2012)
Hall Mark and some other
businesses embezzled BDT 3,547
crores.
(The Daily Star, 14th August, 2012)
In October 2012, the ACC filed 11
cases against 27 people, including
Hallmark Group Chairman and
Sonali Bank's 20 former and present
officials.
(Dhaka Tribune, 11th July, 2018)
Janata Bank
(2010-2015 &
2013 to present)
Fraudulence by Crescent and
AnonTex involving BDT 10,000
crores.
(Dhaka Tribune, 3rd November,
2018)
On 30th October, 2018, an inquiry
committee, headed by an Executive
Director of BB, submitted a report to
the BB on the scam.
(Dhaka Tribune, 3rd November,
2018)
20. 20
3.1 Scams, Irregularities and Heists
(contd...)
Bank/ Institution
Involved
Scam Measures
Janata Bank, Prime
Bank, Jamuna
Bank, Shahjalal
Islami Bank Ltd
and Premier Bank
(June 2011-July
2012)
Embezzlement and
laundering of BDT 1,174.46
by Bismillah Group and its
fake sister concerns.
(The Daily Star, 7th
October, 2016)
On November 3, 2013, the ACC
filed 12 cases against 54 people
over the scam.
(The Independent, 11th
September, 2018)
AB Bank
(2013-2014)
Money laundering of BDT
165 crores.
(The Daily Star,12th June,
2018)
On January 25, 2018, the ACC
filed a case against former AB
Bank chairman and officials.
(The Daily Star, 12th March,
2018)
21. 21
3.1 Scams, Irregularities and Heists
(contd...)
Bank/
Institution
Involved
Scam Measures
NRB
Commercial
Bank
(2013-2016)
Gross irregularities over
disbursing loans of BDT
701 crores.
(New Age Bangladesh, 10th
December, 2017)
On December 29, 2016, the central
bank appointed an observer at the
bank to restore discipline and
corporate governance.
(Dhaka Tribune, 7th December,
2017)
Janata Bank
(2013-16)
Loan scam involving BDT
1,230 crores
(The New Nation, 22nd
October, 2018)
In October 2018, Thermax
requested to reschedule the entire
loan again (previously restructured
in 2015). Janata Bank’s board
endorsed this proposal by Thermax
and sent it to the BB for approval.
(The Daily Star, 21st October, 2018)
22. 22
3.1 Scams, Irregularities and Heists
(contd...)
Bank/
Institution
Involved
Scam Measures
Farmers Bank
(2013-2017)
Fund embezzlement of
by 11 companies eg: NAR
Sweaters Ltd, Advanced
Development
Technologies etc.
involving BDT 500
crores.
(The Daily Star, 24th
March, 2018)
In January 2018, Farmers Bank was
directed by the BB to conduct a
functional audit on credit accounts
with outstanding amount of at least
BDT 1 crore in its Motijheel branch.
(The Daily Star, 24th March, 2018)
In April 2018, the Anti-Corruption
Commission (ACC) arrested four
accused, including the Farmers Bank's
former Audit Committee chairman.
(The independent, 11th April, 2018)
23. 23
3.1 Scams, Irregularities and Heists
(contd...)
Bank/
Institution
Involved
Type of Scam Amount Measures
Bangladesh
Bank
(February 5,
2016)
Heist of BDT 679.6 crores by
international cyber hackers
from treasury account of
Bangladesh Bank with the
New York's US Federal
Reserve Bank.
(The Daily Star, 5th August,
2017)
On March 19, 2016, the
government formed a 3-member
investigation committee, headed
by former governor of Central
Bank Dr Farashuddin.
(The Daily Star, 5th August,
2017)
24. 24
3.2 Total Money Lost through Major
Scams, Irregularities, & Heists
Sonali, Janata, NCC, Mercantile & Dhaka Bank BDT 5.89 crore
BASIC Bank BDT 4,500 crore
Sonali Bank BDT 3,547 crore
Janata Bank BDT 10,000 crore
Janata Bank, Prime Bank, Jamuna Bank, Shahjalal
Islami Bank & Premier Bank
BDT 1,174 crore
AB Bank BDT 165 crore
NRB Commercial Bank BDT 701 crore
Janata Bank BDT 1,230 crore
The Farmers Bank BDT 500 crore
Bangladesh Bank BDT 679 crore
TOTAL BDT 22,502 crore
25. 25
3.3 Cost of Major Scams, Irregularities,
& Heists
• 34% of total allocation for education in national
budget of FY2017-18
• 39% of income tax revenue of GoB in FY2017-18
as of May 2018
• 78.2% of Padma Multipurpose Bridge (PMB)
• 64.3% of Padma Bridge Rail Link
• 62.5% of Matarbari 2x600 MW Ultra-Super
Critical Coal-Fired Power Project (MUSCCFPP)
• 40.9% of Deep Sea Port in Sonadia
• 19.9% of 2x1200 MW Ruppur Nuclear Power
Plant (RNPP) Main ProjectSource: Monthly Fiscal Report, Ministry of Finance and CPD (2018): State of the Bangladesh Economy in FY2018 (Third Reading)
26. 26
3.4 BDT 22,502 crore would be
enough for
• Total allocation for health in national budget of FY2017-
18 (BDT 20,651 crore)
• Dhaka Mass Rapid Transit Development Project
(DMRTDP) (Cost: BDT 21,985 crore)
• Construction of Single Line Dual Gauge Track from
Dohazari-Ramu-Cox’s Bazar and Ramu to Ghundum near
Myanmar Border (Cost: BDT 18034 crore)
• 2×660 MW Moitree Super Thermal Power Project
(MSTPP) in Rampal (Cost: BDT 16000 crore)
• Construction of Bangabandhu Railway Bridge (Cost: BDT
9,734 crore)
• Construction of Multilane Road Tunnel under River
Karnaphuli (Cost: BDT 8,447 crore)
• Deep Sea Port at Paira (Cost: BDT 3351 crore)
Source: CPD (2018): State of the Bangladesh Economy in FY2018 (Third Reading)
28. 28
4.1 Problems of Monopolisation
• When banks transform from being financial
intermediaries to becoming monopolies, they
become a growing cause for concern.
• The monopolisation of banking is usually
accompanied with a deterioration in
governance.
• When financial capital becomes concentrated
into the hands of few, monopolies extract
supernormal profits at the cost of the welfare of
the ordinary population.
• Crony capitalists use banks as vehicles for
reaching their goal of financial oligarchy
29. 29
4.2 Detrimental Amendments of
Banking Company Act
• Two detrimental amendments of dubious
nature have been made to the Banking
Company Act in 2018, which undermined the
cause of good governance.
• The tenure of board of directors was
increased from 6 years to 9 years, and up to 4
family members would be allowed to be on
the Board, instead of the earlier 2 per family.
• These changes are apprehended to reinforce
crony capitalism in a sector of the economy
already impaired by poor governance.
30. 30
4.3 Banking Oligarchies
• In 2017, a single corporation gained control over
7 private commercial banks in Bangladesh (The
Daily Star, 2017).
• Following this development, there were major
changes in the top management of these banks
(New Age, 2017)
• However, monopolization of banking was not
only limited to corporations, but also spread to
business families.
• Despite being cautioned by the central bank in
2014, two private commercial banks still had 4
or more members from the same family in their
Board of Directors, as of 12th January 2018
(CPD, 2018).
32. • Mexico has only 47 commercial
banks even though the GDP of
Mexico in 2016 was about 7.4
times larger than that of
Bangladesh in 2016 and the
total surface area of Mexico is
about 13.2 times larger than
that of Bangladesh (CPD, 2018).
• Globally, if microstates that
have a land area less than 1000
square kilometres are
disregarded, Bangladesh has
the 8th highest geographic
concentration of commercial
bank branches (CPD, 2018).
• In 2016, Bangladesh had 75
branches of commercial banks
per 1000 square kilometres of
land, which was the highest in
the South Asia region (CPD,
2018).
32
5.1 High Concentration of Banks and
Bank Branches in Bangladesh
Figure: Branches of commercial banks per 1,000 square
kilometres in South Asia (2016)
Source: IMF Financial Access Survey Data
Note: * indicates data for 2015
0
10
20
30
40
50
60
70
80
Bangladesh
Bhutan
India
Nepal
Pakistan
SriLanka*
Numberofcommercialbankbranchesper1000
squarekilometres
33. 33
5.2 Bank Licenses as Gifts
• In 2013, the government approved licenses of 9 new
private commercial banks: Meghna Bank Limited,
Midland Bank Limited, Modhumoti Bank Limited,
NRB Bank Limited, NRB Commercial Bank Limited,
NRB Global Bank Limited, South Bangla Agriculture
and Commerce Bank Limited, The Farmers Bank
Limited, and Union Bank Limited.
• All of these banks were backed by politically
powerful owners.
• License for opening a new commercial bank has, in
fact, become a tool for misappropriation of public
money.
• The fourth generation banks (9 newly approved
commercial banks) are beset with large amounts of
NPLs and are making losses.
34. 34
5.3 Excessive number of banks, yet
attempts to permit more
• According to the Bank Company
(Amendment) Act 2013, the central bank will
decide to grant licenses to new commercial
banks after considering the need for such
banks and the overall state of the economy.
• Ironically, this principle is not followed in
Bangladesh in case of issuing bank license.
• 95% of the bank officials believed that the
fourth generation banks in Bangladesh were
redundant (Nabi, 2016).
36. • Recurrent
recapitalization of SCBs by
the government has
emerged as an issue of
grave concern, and the
government has taken
recourse to this measure
on a regular basis.
• It has been estimated that
the GoB has spent BDT
15,705 crore in
recapitalizing the banks
during the period
FY2009-FY2017 (Monthly
Fiscal Frameworks,
Budget Briefs, Finance
Division).
36
6.1 Recapitalisation
Figure: Amount of Recapitalisation (in crore BDT)
Source: Monthly Fiscal Frameworks, Budget Briefs, Finance Division.
0
500
1000
1500
2000
2500
3000
3500
4000
4500
FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17
CroreBDT
37. 37
6.2 Major Reforms in the Banking
Sector
Date Brief Description of Change
2009 Anti-Terrorism Act is passed to address terror financing
(GoB, 2009)
2009 Banking and Financial Institution Division is formed within the
Ministry of Finance, curtailing the authority of Bangladesh Bank
and acting as an obstacle to the monitoring of state-owned
commercial banks (FID, 2010)
2009 ‘Guidelines on Risk Based Capital Adequacy for Banks’ is
introduced by Bangladesh Bank, in line with Basel II
(Bangladesh Bank, 2008)
2011 Whistleblowers' Protection Act 2011 states that no criminal, civil
or departmental proceedings can be initiated against a person for
disclosing information in the public interest to the authorities,
and his or her identity will not be disclosed without his or her
consent. (GoB, 2011)
38. 38
6.2 Major Reforms in the Banking
Sector (contd...)
Date Brief Description of Change
2012 Customer Interest Protection Centre' (CIPC) is established in the
head office and branch offices of Bangladesh Bank
2012 Money Laundering Prevention Act gives Bangladesh Bank
responsibility for money laundering offences (GoB, 2012)
2012 Bangladesh Financial Intelligence Unit (BFIU) is established for
analyzing Suspicious Transaction Reports (STRs), Cash
Transaction Reports (CTRs) & information related to money
laundering (ML) or financing of terrorism (TF) received from
reporting agencies and other sources and disseminating
information/intelligence thereon to relevant law enforcement
agencies. (Bangladesh Bank, 2012)
2012 Financial Integrity and Customer Services Department (FICSD)
department is established in Bangladesh Bank with a view to
minimizing fraud and forgery in the banking industry.
(Bangladesh Bank, 2014)
39. 39
6.2 Major Reforms in the Banking
Sector (contd...)
Date Brief Description of Change
2013 Bank Company Act is amended. More than two members of the
same family are not allowed to be on the board of directors, and
the tenure of the directors is restricted to six years. (GoB, 2013)
2013 Anti-Terrorism Act is amended to make provisions for the
prevention of terrorist activities and ensure effective
punishment for such activities (GoB, 2013)
2014 ‘Guidelines on Risk Based Capital Adequacy for Banks’ is
introduced by Bangladesh Bank, in line with Basel III
(Bangladesh Bank, 2014)
2014 Bangladesh Bank imposes “Regulations on Electronic Fund
Transfer” (Bangladesh Bank, 2014)
2014 Bangladesh Payment And Settlement Systems Regulations is
introduced by Bangladesh Bank (Bangladesh Bank, 2014)
2015 Money Laundering Prevention Act is amended to reenact a law
regarding the prevention of money laundering and other
connected offenses (GoB, 2015)
40. 40
6.2 Major Reforms in the Banking
Sector (contd...)
Date Brief Description of Change
2015 Financial Reporting Act is passed which requires the
establishment of a new oversight body, referred to as the
Financial Reporting Council (FRC), whose main purpose will be
to regulate the financial reporting process followed by the
quoted companies (GoB, 2015)
2015 Bangladesh Bank introduces “Guideline on ICT Security for
Banks and Non-bank Financial Institutions”
(Bangladesh Bank, 2015)
2017 Bangladesh Financial Intelligence Unit (BFIU) issues a master
circular directing banks to identify relevant risks, risk tolerance
level, and readiness to handle the risks associated with new
technology based payment services before launching the
product (Bangladesh Bank, 2017)
41. 41
6.2 Major Reforms in the Banking
Sector (contd...)
Date Brief Description of Change
2017 Code of Conduct for banks and non-bank financial institutions
introduced by Bangladesh Bank to implement National Integrity
Strategy in the financial sector of Bangladesh
(Bangladesh Bank, 2017)
2017 Bangladesh Bank introduces Guidelines on Environmental &
Social Risk Management (ESRM) for Banks and Financial
Institutions in Bangladesh (Bangladesh Bank, 2017)
2018 Bank Company Act is amended allowing increasing the
maximum number of family members on the board of directors
from two to four and extending the tenure of the board of
directors from six to nine years (Dhaka Tribune, 2018)
43. 43
7.1 Recommendations
• The number of judges dealing with Money Loan
Court Act 2003 and Bankruptcy Act 1997 should be
increased to ensure speedy disposal of loan default
cases and to reduce backlog.
• Immediate actions must be taken against banks that
are performing poorly and are ill-prepared for
BASEL III.
• A new exit policy for troubled banks needs to be
formulated, particularly taking into cognisance the
ineffectiveness of the Oriental Bank model.
• Recapitalisation of SCBs year after year has to be
stopped. Such practice of bailing out the losing
banks with public money is economically unjustified
and morally incorrect.
44. 44
7.1 Recommendations (contd...)
• The decision to keep 50% government funds with private
banks goes against the spirit of central bank’s monetary policy.
Only banks with less than 5% NPLs should be eligible for the
additional available funds from government entities.
• Bangladesh Bank should appoint a strong administrator
immediately to oversee the operation of troubled banks. A
proper audit of the bank should be performed to understand
the real health of the bank.
• The culture of giving licenses to new banks on political grounds
should be stopped. Given the size of the economy there is no
need for new banks.
• The internal control department of SCBs is in need of a serious
overhaul. During financial scams of the past, it was discovered
that the internal control departments either willingly or
unwillingly had failed to inform the Board of Directors
regarding large losses.
45. 45
7.1 Recommendations (contd...)
• In order to truly bring about a profound change in the
banking sector, the most important emergent task is to
combat cronyism. The current practice of recruiting
Board of Directors on political grounds has to be
discontinued. Only unbiased, competent, and honest
individuals should be appointed as Member of the Board
of SCBs.
• The independence of the central bank should be upheld.
Interference in Bangladesh Bank’s activities goes against
the spirit of Bangladesh Bank Amendment Bill 2003
which was geared to guarantee the central bank with
autonomy.
• Lack of capacity building is a perennial problem that
besets the SCBs in Bangladesh. Without human resource
development through enhanced skills, SCBs will not be
able to handle the emerging challenges facing the sector.
46. 46
7.2 A Commission for the Banking
Sector
• CPD has earlier argued for setting up an
independent commission for the banking sector
in view of addressing emerging challenges.
• The broad terms of reference (ToR) of the
commission will be to critically assess the
problems and weaknesses of the banking
industry.
• Such a commission will suggest concrete
recommendations for prudential banking, and
prepare guidelines regarding management,
automation, risk management, and internal
control.
• The budget should allocate adequate funds for
setting up this commission.
47. 47
7.3 Commitments from Political
Parties during Electoral Debate
I. Recognise the Problem: First and foremost, the challenges of the
banking sector should be recognized. A thorough review of the
state of the banking sector has to be carried out and establish more
transparency on the state of affairs.
II. Autonomy of the Central Bank: Supervisory and monitoring role of
Bangladesh Bank should to be significantly strengthened for
smooth functioning of the sector
III. Blue Ribbon Committee for Appointing Board Members: The
process of appointing board members should be de-politicised. A
highly qualified and experienced committee should be formed to
select board members. The culture of selecting board members
based on the political loyalty and affiliation must change.
IV. No New Banks: Do not give licenses for new commercial banks.
V. Reform of Judicial Process: Trial of scams and irregularities cases
should expedited and exemplary measures should be taken against
the involved people. Speedy recovery of default loans should be
implemented through special tribunal should be set up for bank
defaulters.