Staff Reporter :
Good governance in the country’s banking sector will be restored soon and the central bank has identified 10 banks that are relatively weak in performance.
“The 10 scams hit banks will remain under close monitoring of the Bangladesh Bank (BB) to improve their financial situation,” said BB Governor Abdur Rouf Talukder while speaking at a press conference on his steps taken to ease inflationary pressure and contain the foreign exchange rate at the BB headquarters on Thursday.
Currently, the 10 banks namely Sonali, Janata, Rupali, Agrani, Bangladesh Krishi Bank, BASIC, ICB Islamic and Padma have the central bank’s observer. But their financial health is still ailing.
He further said long-term loans with short-term deposits are the main causes of nonperforming loans (NPL) in the country.
“It creates a mismatch (between assets and liabilities), which is a major reason to default loans,” the BB governor said.
Giving a way for entrepreneurs to get loans for the long term, he said, “We want big companies to raise long-term funds through issuing bonds. And, if banks lend short-term loans, NPL will come down significantly.”
The governor further said that he wants to see the secondary bond market get vibrant.
Replying to a query on the new loan rescheduling policy, he said the decision has been taken to empower banks and make bankers liable for the loans.
“When the central bank approves rescheduling of a loan, it becomes a party, which ultimately impacts our inspection work,” he said.
“Rescheduling of loans is not our work,” he categorically said.
The governor also shed light on the trade and foreign exchange situation.
He said the trade gap in July has been reduced significantly and an increase in inward remittances gave the economy breathing space.
“If the trend continues, the economy will be stable soon,” he said.
He said import in July was $6 billion and exports and remittances earned $6.1 billion.
“The trade gap in July has been reduced significantly and a rise in inward remittances is giving the economy a breathing space . . . dollar price will become stable in two to three months,” he said.
Talukder, a former finance secretary, started his new innings as the governor of Bangladesh Bank in the second week of July. But the time is very challenging as the economy is facing multiple setbacks – from soaring inflation to exchange rate volatility and depleting foreign exchange reserves.
