News media reported that the ruling government is not attentive to establish discipline and good governance in the financial sector in line with their electoral pledges. Rather their inaction towards corrupt people, loan scams, and share market looters, and the recapitalization of State-owned Banks denotes the contrary position. We see random political intervention and lack of good governance has apparently handicapped the regulatory bodies like the Bangladesh Bank and the Securities and Exchange Commission. Its result was not good. Now the people have no confidence in the government about the establishment of financial integrity, good governance and rules of laws.
Finance Minister AMA Muhith told Parliament on September 13 that the amount of defaulted loans, as of June, was Tk 131,666 crore with five State-owned Banks carrying the lions share. In these years, the government provided Tk 9,788 crore for bailing out the State-owned Banks with over Tk 6,000 crore sanctioned to Sonali and BASIC. The government also forced State-owned Banks to provide Tk 715 crore to the scam-hit Farmers Bank despite criticism that the proposed bailout fund would set a bad precedent. And the unprecedented reserve heist of US$101 million from the Central Bank’s accounts with the Federal Reserve Bank of New York in February 2016 by hackers grabbed the headlines in the home and abroad. But the government did nothing, except making a plethora of assurances.
Amidst the situation, the government made the private banks operate as family business by allowing three members of a family to its boards. The Dhaka Stock Exchange witnessed two collapses, in 1996 and 2010; with the Awami League-led government in power, but no one faced the music.
The abysmal condition of the country’s banking sector raised questions about the government’s commitments to keep the discipline of the sector. The status of Bangladesh in doing business and global financial integrity indexes has become worse. The actions and interactions of the government lead one to apprehend that it wishfully allows its men to do whatever they want in exchange for personal and party gain.
In the next time the government will face a bankrupt situation for running the affairs of the country. All funds have been exhausted.
