Finance Minister AMA Muhith said on Sunday that the banking sector is weak now due to irregularities and soaring Non-Performing Loans (NPLs).
“There have been many discussions and criticismon the banking sector. Many people want to say the banking sector has gone out of control. Now,it is considered a weak sector.We have a very large number of banks here, this is another topic of criticism from different quarters,” Muhith told a program of bank directors.
He was addressing a training program for directors of state-owned banks, held at the Bangladesh Institute of Capital Market (BICM) auditorium in the capital.
Muhith in his speech blamed directors of private commercial banks, saying many directors take loans from other private banks, often bypassing set regulations.
“It is very tough to control the practice by private bank directors. But it should be stopped. We have to find ways to control it,” said the finance minister.
AMA Muhith also said the big problem is non performing loans. Here, he said, the blame largely goes to public sector banks.
Underscoring the need for bank merger, the finance minister said the practice is new in the country. He sought assistance from bank directors to frame a befitting merger policy.
He urged bankers and directors to back good borrowers, even though they become defaulters under circumstantial reasons.
Finance Minister AMA Muhith was the chief guest at the program. State Minister of Finance M.A. Mannan MP and Fazle Kabir, Governor of Bangladesh Bank were special guests. Financial Institutions Division Secretary Md Asadul Islam chaired the training program.
