Bank and Financial Institution Division will sign a Memorandum of Understanding (MoU) with state-owned banks and financial institutions to establish a proper commercial environment from January next year increasing efficiency, accountability and dynamism, official sources said.
“We will sign an MoU with all state-owned banks and financial institutions one by one to achieve some key performance indicators,” Banking Secretary M Aslam Alam told Dhaka Tribune on Sunday. He also said the Division will strictly monitor the key performance indicators of state banks and financial institutions at three-month intervals while the centrak bank will monitor financial activities.
In 2007, the Division gave full financial freedom to boards of directors of state-owned banks and financial institutions, but they failed to maintain expected environment, he said.
“That’s why the Division has to start monitoring activities of the boards,” secretary said. During the three months of monitoring, the Division and Bangladesh Bank will monitor the classified loans, capital adequacy, profit margin, return of assets, return of equity, credit against net assets, assets turnover ratio, growth of deposit and statement of credit growth.
The Banking Division sources said the chairmen of seven state-owned banks, Investment Corporation of Bangladesh and Sadharan Bima Corporation and Jiban Bima Corporation will sign MoU with the Division secretary.
