'The central bank will act in line with the committees' recommendations'
The Bangladesh Bank has formed two high-powered committees to recommend measures for reducing the volume of non-performing loans (NPLs) in the country's banking system.
Of the two committees, one has been formed with senior officials of four departments of the central bank. The departments are Banking Regulation and Policy Department (BRPD), Department of Off-Site Supervision (DOS), Department of Banking Inspection (DBI), and Financial Stability Department (FID).
BRPD Executive Director Mohammad Masum Kamal Bhuiyan will lead the committee, which will monitor and supervise the private sector bank’s NPLs .
The other committee has been formed with senior officials of Department of Banking Inspection 2 (DBI 2) and representatives of the Ministry of Finance.
DBI- 2 Executive Director Mohd Humayun kabir will lead the committee, which will monitor and supervise the state-owned bank’s NPLs.
Bangladesh Bank Executive Director and Spokesperson Md Serajul Islam has told Dhaka Tribune: “The committees will prepare its recommendations in consultation and find out how to lower NPLs.”
“The central bank will act in line with the committees' recommendations. We expect that the committees will submit their recommendations to the BB governor as early as possible,” he adds.
According to the BB latest data, the non-performing loans (NPLs) of banks rose by a staggering Tk16,962 crore in a period of three months to March this year, increasing the amount of stress loan in the banking sector to Tk1,10,873.54crore, which is the largest ever in the country's history
The bad loan amount was 11.87% of total disbursed loans in the given month, according to the latest Bangladesh Bank (BB) data.