The Governor of Bangladesh Bank (BB) Ahsan H. Mansoor said actions will be taken against guilty person for irregularities in the banking sector, not against institution because it may impact the economy and livelihood of many people employed in these organizations.
He said loan activities of six islami banks have been restricted including the Islami Bank, they will not be given liquidity support until their boards were reformed. He was speaking at a press conference in the central bank Tuesday. Deputy Governor Dr. Habibur Rahman and Nurun Nahar among others were present
The governor said "we will take action against person involved in irregularities, not against any institution." Regarding the board of the weak banks, he said dissolution of their board is under process.
The governor said, inflation will come down within 6-7 months. Monetary policy will not change much but to be tightened a bit. The currency market is in slightly better position. The dollar went to 125 taka, but now it has come down.
When asked about the outgoing government's plan to borrow Tk 1,37,500 crore from banks to cover budget deficit for 2024-25, Ahsan H Mansoor said credit is low. The budget has a borrowing target of Tk 1,37,500 crore, we will talk about reducing it.
He said, we want to go to international standards with NPL (non-performing loans). Traders have asked for some time to do this. They claim that this will affect the export-import. We have said we will discuss it with the IMF, but there is no doubt we will go to international standards.
Regarding the instability of government owned banks such as Sonali and Palli Sanshaya Bank is unfortunate. We have seen the S Alam group issues, but it is really unfortunate instability in government banks.
Deposits are rising in five banks except Islami Bank controlled by S Alam Group, especially from SIBL.Ahsan H. Mansoor said S Alam has control over several banks. It is up to the clients to deposit and withdraw there. They will withdraw deposit if they don't feel safe.
He said why we are not giving liquidity support to banks in which customers trust dwindles. "We cannot rescue them. It will not always be right to rescue."
It is also not right to suddenly close any bank or to bail out them with money. He said instability of banks did not happen in a day.
The Governor said announcement of the banking commission may come in few days. About appointment of deputy governor, there is a search committee working. EDF (Export Development Fund) was set up in good faith, then our demand for funds was also low. Now that environment has changed.
We are trying to stabilize dollar market. Our goal is that no one should approach the government for dollar. We will work to reduce our dependence on reserves, it would be better if we could bring it down to zero.
About loan installment facility, he said if 10 to 20 institutions are heavily affected by the movement, we can take them into consideration. We can do something about it. In the case of small and medium enterprises, this benefit may be available, but no large organization will get it.
