Economic Reporter :
Out of the total 56 banks in the country, only four per cent banks have the IT (information technology) Strategy Committee and only eight per cent have the Risk Management Committee, said Bangladesh Institute of Bank Management (BIBM) Director General Dr. Shah Md. Ahsan Habib on Thursday.
The BIBM Director underscored the need for improving IT governance in banks with a view to checking future financial crimes.
“Strong IT governance is co-related with the stability of the banking sector,” Dr.Ahsan Habib said this while addressing a research workshop on “IT Governance in Banks: Challenges and Remedies” at the auditorium of BIBM in the city. The workshop was organized by BIBM.
Dr. Habid called upon the financial institutions to create a separate fund for improving the efficiency of the IT officials, which would help establish corporate governance in the banking sector. Corporate governance is essential for sustainable growth of any organization and IT governance is an important component for ensuring corporate governance especially in the financial sector, he pointed.
Addressing the workshop, Associate Professor of BIBM Md. Shihab Uddin Khan said,
Cyber security is the global issue and financial sector is the prime target of the cyber-attacks.
Eighty-eight per cent of the banks do not have a documented and approved IT roadmap, he said, adding that management thought that the expenditure on IT as a cost of doing business not as an investment to the business development.
On the other hand, 78 per cent of the banks do not have Service Level Agreement (SLA) monitoring process, Shihab Uddin informed. Management approves IT budget for system implementation but they are reluctant on training for IT personnel, he claimed. “IT skill development budget approval is a challenge for them.”
He underscored the need for spreading the heightened sense of awareness for controlling and exploiting IT to the maximum extent to derive the full benefit in terms of managed risks, reduced cost to ensure business benefits and competitiveness.
“Our banking system is still far away to adopt effective ITG (Information Technology Governance) framework. IT governance is the responsibility of the board of directors and executive management”, said Sihab Uddin.
IT governance is gaining importance in the banking sector due to the critical reliance on technology, but only 12 per cent banks have ITG framework which is indicating severe weakness in respect of management’s active involvement in IT operations in banks, he opined.
“It is surprising that only 28 per cent banks are using the central bank ICT Security guidelines”, he said, adding about 80 per cent IT heads of the banks are not satisfied enough to run their IT system efficiently due to insufficient IT manpower.
Shihab khan identified three major challenges to enrich IT system as international standard. Skilled IT manpower, guideline and budget are needed to enrich the IT system in banks.
So far, Tk 30,000 crore was invested in the development of IT system in banks, but mere the Grameen Phone invested almost Tk 45,000 crore to develop its IT system.
He underscored the need for reducing gap between the top management and IT official to ensure effective IT management. He urged the central bank to take more proactive approach to bring all the banks at the same level of IT automation, manage IT related risks and implementation of IT governance.
He suggested that the central bank should provide a standard ITG policy and arrange generalized training for top management to understand the necessity of investment in IT sector.
Md. Mahbubur Rahman Alam, Associate Prof and Kaniz Rabbi, Assistant Prof of BIBM, S. M. Mainuddin Chowdhury, Deputy Managing Director of Southeast Bank Ltd., Md. Shamsuzzaman, Deputy Managing Director of Islami Bank Bangladesh Ltd. and Monitur Rahman, Technology Head, Standard Chartered Bank were present in the workshop.
Out of the total 56 banks in the country, only four per cent banks have the IT (information technology) Strategy Committee and only eight per cent have the Risk Management Committee, said Bangladesh Institute of Bank Management (BIBM) Director General Dr. Shah Md. Ahsan Habib on Thursday.
The BIBM Director underscored the need for improving IT governance in banks with a view to checking future financial crimes.
“Strong IT governance is co-related with the stability of the banking sector,” Dr.Ahsan Habib said this while addressing a research workshop on “IT Governance in Banks: Challenges and Remedies” at the auditorium of BIBM in the city. The workshop was organized by BIBM.
Dr. Habid called upon the financial institutions to create a separate fund for improving the efficiency of the IT officials, which would help establish corporate governance in the banking sector. Corporate governance is essential for sustainable growth of any organization and IT governance is an important component for ensuring corporate governance especially in the financial sector, he pointed.
Addressing the workshop, Associate Professor of BIBM Md. Shihab Uddin Khan said,
Cyber security is the global issue and financial sector is the prime target of the cyber-attacks.
Eighty-eight per cent of the banks do not have a documented and approved IT roadmap, he said, adding that management thought that the expenditure on IT as a cost of doing business not as an investment to the business development.
On the other hand, 78 per cent of the banks do not have Service Level Agreement (SLA) monitoring process, Shihab Uddin informed. Management approves IT budget for system implementation but they are reluctant on training for IT personnel, he claimed. “IT skill development budget approval is a challenge for them.”
He underscored the need for spreading the heightened sense of awareness for controlling and exploiting IT to the maximum extent to derive the full benefit in terms of managed risks, reduced cost to ensure business benefits and competitiveness.
“Our banking system is still far away to adopt effective ITG (Information Technology Governance) framework. IT governance is the responsibility of the board of directors and executive management”, said Sihab Uddin.
IT governance is gaining importance in the banking sector due to the critical reliance on technology, but only 12 per cent banks have ITG framework which is indicating severe weakness in respect of management’s active involvement in IT operations in banks, he opined.
“It is surprising that only 28 per cent banks are using the central bank ICT Security guidelines”, he said, adding about 80 per cent IT heads of the banks are not satisfied enough to run their IT system efficiently due to insufficient IT manpower.
Shihab khan identified three major challenges to enrich IT system as international standard. Skilled IT manpower, guideline and budget are needed to enrich the IT system in banks.
So far, Tk 30,000 crore was invested in the development of IT system in banks, but mere the Grameen Phone invested almost Tk 45,000 crore to develop its IT system.
He underscored the need for reducing gap between the top management and IT official to ensure effective IT management. He urged the central bank to take more proactive approach to bring all the banks at the same level of IT automation, manage IT related risks and implementation of IT governance.
He suggested that the central bank should provide a standard ITG policy and arrange generalized training for top management to understand the necessity of investment in IT sector.
Md. Mahbubur Rahman Alam, Associate Prof and Kaniz Rabbi, Assistant Prof of BIBM, S. M. Mainuddin Chowdhury, Deputy Managing Director of Southeast Bank Ltd., Md. Shamsuzzaman, Deputy Managing Director of Islami Bank Bangladesh Ltd. and Monitur Rahman, Technology Head, Standard Chartered Bank were present in the workshop.
