The Bangladesh Association of Banks (BAB), representing the owners of the country’s private commercial banks, has formally requested the interim government to enact more stringent legislation to facilitate the recovery of non-performing loans (NPLs). The industry body stated that such measures are vital to address structural deficiencies within the financial sector resulting from widespread financial irregularities under the previous political administration.

The proposal was presented during an official meeting on Tuesday with the Finance Minister, Amir Khosru Mahmud Chowdhury, at the Ministry of Finance secretariat in Dhaka, preceding the formulation of the national budget.

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Proposals for Reforming Loan Defaulter Trial Procedures

A delegation of bank owners, led by the Chairman of the BAB, Abdul Hai Sarker, held detailed discussions with the Finance Minister regarding the current operational environment of the banking sector. Following the meeting, Mr Sarker indicated that comprehensive legal reforms could significantly expedite asset recovery.

“If the government toughens the laws, at least 60 per cent of bad loans can be recovered very easily,” Mr Sarker stated.

A central demand submitted by the BAB is the introduction of a statutory amendment mandating the physical presence of accused loan defaulters in the court dock during judicial proceedings. Under current legal frameworks, defaulters are permitted to be represented solely by legal counsel. The BAB argued that this allowance enables individuals who have fled overseas to systematically evade loan repayment while utilizing representatives to prolong judicial outcomes, thereby causing inordinate delays in asset recovery. Furthermore, the association requested legislative amendments to restrict the number of family members permitted to serve simultaneously on a single banking company’s board of directors.

Inward Investment and Corporate Taxation Dialogues

Prior to the session with private bank owners, Finance Minister Chowdhury convened a separate meeting with a delegation from the Foreign Investors’ Chamber of Commerce and Industry (FICCI). Led by its President, Rupali Haque Chowdhury, the chamber discussed investment priorities for the upcoming National Budget for Financial Year 2026–27.

The dialogue focused on the domestic investment climate, macroeconomic challenges, and statutory mechanisms required to attract higher volumes of Foreign Direct Investment (FDI). The FICCI delegation emphasised the necessity of a predictable, consistent, and transparent policy framework, recommending a long-term budgetary roadmap to assist multinational firms in projecting future tax obligations.

Ms Chowdhury highlighted a disparity between nominal and effective corporate tax rates, noting that non-deductible business expenses and administrative hurdles significantly inflate the actual tax burden on businesses. The chamber advocated for broadening the national tax base rather than increasing the fiscal burden on existing compliant corporate taxpayers.

Summary of Delegations and Core Ministerial Commitments

The Finance Minister assured both trade bodies that the administration is committed to aligning Bangladesh’s financial regulations with international best practices.

Delegation Entity	Principal Leadership	Key Policy Demands Submitted	Government Assurance
Bangladesh Association of Banks (BAB)	Abdul Hai Sarker (Chairman)	Mandatory physical presence of defaulters in court; restrictions on family directors; tougher asset recovery laws.	Pledged to enforce international best practices and implement necessary measures to eliminate systemic irregularities.
Foreign Investors’ Chamber of Commerce & Industry (FICCI)	Rupali Haque Chowdhury (President)	Implementation of a long-term budgetary roadmap; reduction of effective corporate tax rates; broadening the tax base.	Acknowledged the principle of broadening the tax base as a necessary direction for future budgetary policy.

The meeting concluded with confirmations from the Ministry that the points raised by the BAB regarding banking discipline and by the FICCI regarding the investment climate would be reviewed during the ongoing preparation of the FY 2026–27 national budget. The FICCI meeting was also attended by Senior Vice-President Deepal Abeywickrema and Vice-President Mohammad Iqbal Chowdhury.