Bangladesh’s newly formed government has pledged to maintain the ongoing reform initiatives within the country’s banking sector. Key areas of focus include controlling inflation, reducing non-performing loans (NPLs), and ensuring the stability of recently merged banks. The commitment was confirmed on Monday by Bangladesh Bank Governor Ahsan H. Mansur following a briefing with journalists.
Governor Mansur stated, “We reviewed the progress of various banking reform initiatives with Finance Minister Ameer Khasru Mahmud Chowdhury. I presented the ongoing activities to the Minister, who expressed strong support for their continuity. His response was extremely positive.”
He emphasised that controlling inflation remains one of the government’s foremost economic priorities. “There is no disagreement on the need to curb inflation,” Mansur said. Bangladesh Bank continues to employ stringent monetary policies, liquidity management, and interest rate adjustments to achieve this goal. Measures are being taken to limit excess liquidity in the market while maintaining policy consistency to stabilise price levels.
Another key discussion point was the rising level of non-performing loans. The central bank has already implemented rigorous measures, including legal action against major defaulters, tightening loan restructuring policies, identifying deliberate defaulters, and increasing transparency in loan classification. Mansur noted, “Regular consultations with bankers indicate that these measures are beginning to yield tangible results.”
The stability of the recently merged United Islami Bank, formed through the consolidation of five banks, was also a major topic. Mansur reported that deposit inflows are gradually increasing, while the bank’s administrators and board are supervising ongoing reforms prior to appointing a new managing director.
United Islami Bank Key Figures
| Bank Component | Authorised Capital (BDT) | Paid-up Capital (BDT) | Government Share (BDT) |
|---|---|---|---|
| Exim Bank | – | – | – |
| Social Islami Bank | – | – | – |
| First Security Islami Bank | – | – | – |
| Global Islami Bank | – | – | – |
| Union Bank | – | – | – |
| United Islami Bank (Merged) | 400 billion | 350 billion | 200 billion |
Following the merger, United Islami Bank now has an authorised capital of BDT 400 billion, a paid-up capital of BDT 350 billion, with the government contributing BDT 200 billion.
In recent years, Bangladesh’s banking sector has faced challenges including loan irregularities, politically influenced lending, capital flight, and weak oversight. The interim administration, following the political transition in August 2024, initiated continuous reforms such as bank mergers, board restructuring, legal action against large defaulters, and liquidity support measures.
The responsibility of fully implementing these reforms now rests with the new government. Top priorities include strengthening governance, addressing capital shortfalls, improving risk management, reducing NPLs, and enhancing sector-wide oversight.
Governor Mansur concluded, “The goal is not merely to stabilise the sector, but to restore public confidence in the nation’s banking system.”