BB Financial Stability report 

Dhaka,  Thu,  24 August 2017
Published : 05 Aug 2017, 20:49:35
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Letter

BB Financial Stability report 

BANGLADESH BANK has recently released its Financial Stability Report (FSR) on banks and in the report it made some observations on the banking sector and warned the banking sector of some bad consequences. The non-performing loans (NPL) of banks have soared to an unexpected height which is a serious cause of concern for the banking sector and the economy. The central bank it was also stated in the report that the quality of banks' assets is poor and a big chunk of the non-performing loans are concentrated in five sectors which leaves the banking sector under serious risks. Although Bangladesh Bank has been pressing hard the private and public sector banks for a long time to cut down non-performing loans, statistics show that NPLs are increasing unabated in every quarter which has a negative impact on the banking sector as well as the economy as a whole. If loans are misused in spite of restructuring and rescheduling, the situation would be much worse in days ahead. Banks have to take prudent decisions before lending. Many banks are resorting to aggressive lending as a result of which they are facing capital shortfalls. Under the prevailing situation, all the stakeholder banks, central bank and the government should come forward to salvage the banking sector from dire consequences.

Emran Zonaed

A banker

zonaed.emran@gmail.com

 
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