The newly established government of Bangladesh has committed to continuing the ongoing reform programme in the country’s banking sector, with a particular focus on controlling inflation, reducing non-performing loans, and ensuring the stability of recently merged banks, Bangladesh Bank Governor Ahsan H Mansur announced on Monday.
Speaking to reporters after a closed-door meeting with Finance Minister Amir Khosru Mahmud Chowdhury at the Secretariat, Governor Mansur said the discussions centred on reviewing progress in various reform initiatives undertaken by the central bank over recent months.
“We briefed the finance minister on the reforms we are implementing. He has emphasised the continuation of these measures and expressed strong support. His response was very positive,” Mansur said.
He further highlighted that controlling inflation remains one of the government’s foremost priorities.
“Inflation must be brought down — there is no disagreement on this,” the governor said.
According to Mansur, the central bank is addressing inflation through tighter monetary policy, improved liquidity management, and coordinated interest rate adjustments. Efforts are being made to limit excess liquidity in the market while ensuring that monetary policy aligns with inflation-control objectives.
Another key topic of discussion was the issue of rising non-performing loans (NPLs). The central bank has introduced stricter measures to tackle the problem, including strengthened legal action against major defaulters, tighter loan restructuring policies, identification of wilful defaulters, and enhanced transparency in loan classification.
“We are holding regular discussions with bankers. Many believe the steps taken are beginning to produce tangible results,” Mansur added.
The stability of the five banks merged to form the consolidated Islami Bank was also reviewed. The governor noted that deposit inflows are gradually improving, and the institution’s administrator and board continue to oversee reforms until a new managing director is appointed.
Consolidated Islami Bank: Key Details
| Bank Components | Authorised Capital (Tk) | Paid-up Capital (Tk) | Government Contribution (Tk) |
|---|---|---|---|
| EXIM Bank | – | – | – |
| Social Islami Bank | – | – | – |
| First Security Islami Bank | – | – | – |
| Global Islami Bank | – | – | – |
| Union Bank | – | – | – |
| Consolidated Islami Bank (Merged) | 400 billion | 350 billion | 200 billion |
The merger forms a consolidated bank with an authorised capital of Tk 400 billion and a paid-up capital of Tk 350 billion, of which the government has contributed Tk 200 billion.
Bangladesh’s banking sector has faced persistent allegations of irregularities in recent years, including loan scams, politically influenced lending, capital flight, and weak regulatory oversight. Following the political transition in August 2024, the interim administration initiated a series of reforms aimed at restoring discipline in the sector, such as mergers, board restructuring, legal action against large defaulters, and liquidity support measures.
Many of these reforms remain ongoing, and the responsibility for their full implementation now rests with the new government. Key priorities include strengthening governance, addressing capital shortfalls, improving risk management, reducing non-performing loans, and enhancing supervision across the banking sector.
“The objective is not only to stabilise the sector but also to restore public confidence in the banking system,” Mansur concluded.