ADB and World Bank will Finance the Reform of the Banking Sector in Bangladesh
The Asian Development Bank (ADB) and the World Bank are expected to finance banking sector reforms, including strengthening and modernizing Bangladesh’s central bank.
This decision was made after two separate meetings with the delegation of ADB and World Bank at the head office of Bangladesh Bank on Monday.
The repayment of this loan will take three years. This will be distributed as follows: $500 million in year one, $500 million in year two, and $300 million in year three.
The World Bank is able to contribute $400 million toward a number of bank changes, including as the modernization and expansion of the central bank’s capabilities.
Other top officials attended the meeting between the ADB team and the central bank’s Financial Sector Support and Strategic Planning Department.
After becoming the governor of the central bank, eminent economist Ahsan H. Mansur moved quickly to reform the banking industry, which had been plagued by scandals and irregularities during the previous administration.
Data from Bangladesh Bank indicates that as of the end of June of this year, the total amount of loans in default was over Tk 2 lakh crore, or more than 12 percent of all loans given by the banking industry.
There were 22,480 crores worth of delinquent loans in the banking industry when the Awami League joined the government following its victory in the 2008 elections. Eleven banks’ boards of directors have already been reorganized by the central bank.
