Banks cut CSR spending by 21pc in six months

Bangladesh’s banks reduced their corporate social responsibility (CSR) spending by nearly 21 per cent in the first half of this year as lower profits and losses at several banks squeezed their ability to spend on social programmes.

The country’s 61 commercial banks spent Tk119.04 crore on CSR activities during January-June, down from Tk150.56 crore in the same period last year, according to the latest Bangladesh Bank data.

The spending fell by Tk31.52 crore, or 20.94 per cent, year-on-year.

As many as 17 banks did not spend any money on CSR during the period, including local private banks, state-owned banks and three foreign banks — Woori Bank, National Bank of Pakistan and Habib Bank.

Among the banks reporting no CSR spending were Union Bank, Padma Bank, Global Islami Bank, National Bank, ICB Islamic Bank and First Security Islami Bank.

Bangladesh Commerce Bank, Bangladesh Development Bank, Rajshahi Krishi Unnayan Bank, Bangladesh Krishi Bank, BASIC Bank, Agrani Bank and Janata Bank were also on the list.

The decline in CSR spending comes as the banking sector faces rising losses and weak profitability. Banks normally finance CSR activities from their previous year’s after-tax net profits, meaning weaker profits directly affect their capacity to spend on such programmes.

Of the 43 conventional private banks, 33 spent Tk100.04 crore on CSR during the first six months of the year. Ten Shariah-based banks spent Tk18.36 crore.

Almost the entire CSR spending by the Shariah-based banks came from sources other than their 2025 after-tax net profits. Of the Tk18.36 crore, Tk18.31 crore came from other sources, including fines and income treated as doubtful, while only Tk5 lakh came from net profits.

Health and disaster management received the largest shares of CSR spending during the period. Banks spent Tk34.66 crore on health and Tk34.34 crore on disaster management.

They also spent Tk24.13 crore on education, Tk11.72 crore on environment and climate-related activities, and Tk4.46 crore on sports and culture.

Bangladesh Bank has set guidelines for the distribution of CSR funds by banks. Up to 30 per cent can be spent on education and health, while 20 per cent can go towards environment and climate-related activities. The remaining amount can be spent on areas such as sports, culture, disaster management, infrastructure development and income-generating activities.

The central bank has also allowed banks to use CSR funds to promote the use of Bangla QR, the country’s interoperable digital payment code.

Banks operating at a loss are not allowed to spend from CSR funds. As profitability in the banking sector weakened in 2025, the impact was reflected in lower CSR spending during the first half of this year.

Meanwhile, 35 non-bank financial institutions spent Tk1.85 crore on CSR during January-June, slightly lower than the Tk1.88 crore spent during the same period last year.

Huda