Dr. Forqan Uddin Ahmed :
The central bank came into being 300 years back. Since its inception, the central banks are globally plying a significant role in the rise and fall of economy. The central banks act as the guardian of all other banks and financial institutions. Besides, the central bank fixed up the interest rate, targeting the foreign exchange rate above all act as a chief agent or controller of all government banks, non-government banks and financial institutions. Very recent, the bank owners association’s declaration of bank rate and its other activities made the role and the responsibilities of Bangladesh Bank a very questionable matter. Amidst the clumsy situation the central bank has undoubtedly fallen into attract. This is indeed concerning for nation.
Previously government exclusively played the role to control market economy. The objective was to encourage competition, control monopoly marketing and to ensure public consumers and investor’s interest. Somehow, for various reasons, its performance is not found smooth and satisfactory. Later on, the regulatory bodies like central bank, energy regulatory commission were set up for banking and energy sectors respectively. It is observed that these bodies also turned to non-effective. These bodies also fail to discharge their statutory responsibilities. It is noted that the bank owners are influencing finance ministry, central bank and even the parliament also.
By this time, from the pressure of those bank owners they have increases the number family board members from 2 to 4 and their term has been made from 6 to 9 by an amendment of bank company act. Moreover, making cash reserve ratio 1 is there significant credit. Does it see the bank interest? Again repo rate has been reduced to 0.75%, deposit reigns of non-government bank have been upgraded to 25% to 50 %, and finally they have declared 9% interest loan and 6% dividend on deposit scheme.
The banks are following these instructions. As a result, the bank will face the problem of default loan and the crisis of corporate management.
The central bank is supposed to control banking sectors and fix up the monetary policy. But we see the different picture it is undoubtedly a sad picture for nation. The central bank has become a puppet or a rubber stamp as stated and published by the reports from media. In our country, there are regulatory bodies but they cannot often the duty with freedom. Either the appointed chief are biased and manipulate things along with the vicious circle. They are given the authority but they cannot exercise it properly; for they are weak and waste warmly by the interested groups. Their mindset is made in a negative way. In this case, the mindset of the head of government and firmness of finance minister matter to stop the financial irregularities.
We know that the regulatory bodies failed to perform smooth functioning in 1996 and 2001. As a result a good number of small investor in stock exchange securities became helpless. For Bangladesh Bank’s in efficiency bank reserve was hacked and farmers’ bank irregularities happened.
In 2011 the money liquidity was raised. It was nothing but a created phenomenon and consequently share market had fallen in catastrophe and default loan has increased alarmingly.
This affects other sectors also like government expenditure and revenue management, which had the side effects in the achievements of other avenues this is a bad signal for nation.
The authority concerned must take care of such anarchy, anomalies and bank owner’s association or other vested corners. In the situations, bank may face crisis and country will suffer from shortfall of monetary fund. Ultimately, bankruptcy will attacked the banks and the financial institutions. Life of general people will be in severe problem. Peoples trust will be misled and even the image of banking system will be a matter of fair and doubts.
There will prevail a few tile and fragile economy in the country. To save the banks from the turmoiling situation, the glass stegall Act 1993 was in acted. It was mandated only two restore and ensure the confidence of the deposit holders. By this act the deposited money was made safe from money laundering or anomalies of bank. In this regard, Joseph E Stiglitz said, “Commercial banks are not supposed to be highest risk ventures; they are supposed to manage other people’s money very conservatively. It is with the understanding that the government agrees to pick up the tub should they fail. Investments banks on the other hand, have traditionally managed rich people money, people who can take bigger risk to get bigger returns”.
I want to highlight some other points on loan giving activities of the banks. For transparency in loan giving activities and its return-guideline on credit management 2003 was formulated.
The banks officials must be very meticulously handle it. If it is wrongly handled situation will deteriorate and it will worsen the image of bank. Selection of bank loan clients and good deposit holders should be well judged and highly inspired by its fair deals and management system. Once faith is lost it will never come back. The loan proceeding must be very fair but not harassing or ill intentional. In this context the bank officials must maintain honesty and professional commitment and finally the efficiency.
They must be equipped knowledge and well trained in line of human resource development and technical knowhow. Until they become skilled and equipped with proper knowledge, there will be pilferage anomalies and irregularities.
To overcome in efficiency one must be well trained by series of training, short courses, study and research works, seminar etc. They must be specialized in order to oversee the bank activities very frequently. If irregularities are found they must be properly checked, scrutinizes and investigated.
In banking sectors for its smooth functioning, they should be the provision of timely auditing, supervision and monitoring. And it should be very much continuous. Finally, the bank officials must be progressive and effective with qualities of good servicing, personal behave, attitude, honesty, sincerity and good understanding with their clients. Once faith is established and good professionalism is developed bank will run with honor and dignity.
The central bank came into being 300 years back. Since its inception, the central banks are globally plying a significant role in the rise and fall of economy. The central banks act as the guardian of all other banks and financial institutions. Besides, the central bank fixed up the interest rate, targeting the foreign exchange rate above all act as a chief agent or controller of all government banks, non-government banks and financial institutions. Very recent, the bank owners association’s declaration of bank rate and its other activities made the role and the responsibilities of Bangladesh Bank a very questionable matter. Amidst the clumsy situation the central bank has undoubtedly fallen into attract. This is indeed concerning for nation.
Previously government exclusively played the role to control market economy. The objective was to encourage competition, control monopoly marketing and to ensure public consumers and investor’s interest. Somehow, for various reasons, its performance is not found smooth and satisfactory. Later on, the regulatory bodies like central bank, energy regulatory commission were set up for banking and energy sectors respectively. It is observed that these bodies also turned to non-effective. These bodies also fail to discharge their statutory responsibilities. It is noted that the bank owners are influencing finance ministry, central bank and even the parliament also.
By this time, from the pressure of those bank owners they have increases the number family board members from 2 to 4 and their term has been made from 6 to 9 by an amendment of bank company act. Moreover, making cash reserve ratio 1 is there significant credit. Does it see the bank interest? Again repo rate has been reduced to 0.75%, deposit reigns of non-government bank have been upgraded to 25% to 50 %, and finally they have declared 9% interest loan and 6% dividend on deposit scheme.
The banks are following these instructions. As a result, the bank will face the problem of default loan and the crisis of corporate management.
The central bank is supposed to control banking sectors and fix up the monetary policy. But we see the different picture it is undoubtedly a sad picture for nation. The central bank has become a puppet or a rubber stamp as stated and published by the reports from media. In our country, there are regulatory bodies but they cannot often the duty with freedom. Either the appointed chief are biased and manipulate things along with the vicious circle. They are given the authority but they cannot exercise it properly; for they are weak and waste warmly by the interested groups. Their mindset is made in a negative way. In this case, the mindset of the head of government and firmness of finance minister matter to stop the financial irregularities.
We know that the regulatory bodies failed to perform smooth functioning in 1996 and 2001. As a result a good number of small investor in stock exchange securities became helpless. For Bangladesh Bank’s in efficiency bank reserve was hacked and farmers’ bank irregularities happened.
In 2011 the money liquidity was raised. It was nothing but a created phenomenon and consequently share market had fallen in catastrophe and default loan has increased alarmingly.
This affects other sectors also like government expenditure and revenue management, which had the side effects in the achievements of other avenues this is a bad signal for nation.
The authority concerned must take care of such anarchy, anomalies and bank owner’s association or other vested corners. In the situations, bank may face crisis and country will suffer from shortfall of monetary fund. Ultimately, bankruptcy will attacked the banks and the financial institutions. Life of general people will be in severe problem. Peoples trust will be misled and even the image of banking system will be a matter of fair and doubts.
There will prevail a few tile and fragile economy in the country. To save the banks from the turmoiling situation, the glass stegall Act 1993 was in acted. It was mandated only two restore and ensure the confidence of the deposit holders. By this act the deposited money was made safe from money laundering or anomalies of bank. In this regard, Joseph E Stiglitz said, “Commercial banks are not supposed to be highest risk ventures; they are supposed to manage other people’s money very conservatively. It is with the understanding that the government agrees to pick up the tub should they fail. Investments banks on the other hand, have traditionally managed rich people money, people who can take bigger risk to get bigger returns”.
I want to highlight some other points on loan giving activities of the banks. For transparency in loan giving activities and its return-guideline on credit management 2003 was formulated.
The banks officials must be very meticulously handle it. If it is wrongly handled situation will deteriorate and it will worsen the image of bank. Selection of bank loan clients and good deposit holders should be well judged and highly inspired by its fair deals and management system. Once faith is lost it will never come back. The loan proceeding must be very fair but not harassing or ill intentional. In this context the bank officials must maintain honesty and professional commitment and finally the efficiency.
They must be equipped knowledge and well trained in line of human resource development and technical knowhow. Until they become skilled and equipped with proper knowledge, there will be pilferage anomalies and irregularities.
To overcome in efficiency one must be well trained by series of training, short courses, study and research works, seminar etc. They must be specialized in order to oversee the bank activities very frequently. If irregularities are found they must be properly checked, scrutinizes and investigated.
In banking sectors for its smooth functioning, they should be the provision of timely auditing, supervision and monitoring. And it should be very much continuous. Finally, the bank officials must be progressive and effective with qualities of good servicing, personal behave, attitude, honesty, sincerity and good understanding with their clients. Once faith is established and good professionalism is developed bank will run with honor and dignity.
