United News of Bangladesh

Bangladesh Bank (BB) Governor Md Mostaqur Rahman has expressed agreement in principle with the seven-point demand put forward by the Islami Bank Sachetan Grahak Forum to restore corporate governance in Islami Bank Bangladesh PLC, the platform said on Wednesday. It said central bank Deputy Governor Kabir Ahmed conveyed this to the forum leaders during a meeting at the central bank headquarters. Speaking to journalists after the meeting, the convener of the forum Prof Nur Nabi Manik said the governor took the matter positively. He said the deputy governor told them that the central bank chief agreed in principle with their demands. The forum chief reiterated their core position, emphasising that individuals tainted by financial irregularities, loan scams, or institutional plunder must be permanently barred from occupying positions on the board of directors or holding the post of chairman at Islami Bank. "The new board must consist entirely of highly ethical, professional, and politically neutral individuals," Manik added. He expressed optimism that rebuilding the board based on their seven-point charter will heavily reinforce depositor confidence and restore structural stability to the country's largest Shariah-based commercial lender. Forum leaders assured the central bank that once their demands are visibly implemented on the ground, they will disseminate positive messages to millions of depositors across the country, playing a supportive role in rebuilding the bank's operational legacy. The demands of the forum are formation of an independent, capable, and professional board of directors; reviewing the controversial ownership and shareholding changes of 2017 to reinstate the rights of genuine, original owners; establishing a special tribunal to fast-track the trial of those accused of plundering bank funds; immediate recovery of looted capital and confiscation of illicitly acquired assets; refraining from controversial or arbitrary regulatory decisions to curb panic and volatility across the banking sector; amending Section 18(a) of the Bank Company Act to close rehabilitation loops for financial fraudsters; and withdrawing misleading political statements regarding the bank's health made in Parliament.

Bangladesh Bank Deputy Governor Habibur Rahman on Tuesday said innovative financial instruments like Orange Bonds can play a transformative role in advancing climate resilience, women's empowerment and inclusive growth. “The Orange Bond is a historic milestone for our capital market,” he said, highlighting the country's first Orange Zero Coupon Bond issued through Sajida Foundation. The deputy governor was speaking as chief guest at the 'Orange Economy Summit 2026: Dhaka', jointly organised by Dhaka Stock Exchange (DSE), Impact Investment Exchange (IIX) and Policy Research Institute of Bangladesh (PRI) at the DSE premises He reaffirmed Bangladesh Bank's full backing to attract $100 million in Orange investment by 2030, underscoring the importance of positioning Bangladesh as an attractive investment destination through inclusive and sustainable financing. The summit centred on the potential of a $100 million investment under IIX's Orange Climate Fund for Bangladesh, development of the country's Orange Capital ecosystem, and the role of capital markets in achieving long-term, inclusive and sustainable economic growth. In her welcome address, DSE Managing Director Nuzhat Anwar expressed satisfaction at hosting the summit, saying economic growth must go hand in hand with social inclusion and climate resilience to ensure sustainable development. She noted DSE's commitment to sustainable finance, corporate governance and implementation of international standards, adding that such initiatives would help raise awareness of Orange economy instruments and strengthen the regulatory framework for capital market development. IIX Founder and CEO Professor Durreen Shahnaz said building a robust and inclusive financial market is indispensable for Bangladesh's long-term sustainable growth amid its LDC graduation. She identified vast investment potential in the readymade garments, agriculture, energy transition and financial services sectors, saying deepening the capital market is essential to unlock that potential. Describing the 'Orange Movement' as a global initiative to build inclusive capital markets, Shahnaz said IIX is working to mobilise $10 billion by 2030. She disclosed that IIX has invested over $18 million in Bangladesh over the past decade and announced that $100 million has been earmarked for Bangladesh under IIX's $1 billion Orange Climate Fund. PRI Chief Economist Ashikur Rahman presented the keynote paper titled 'Building an Orange Capital Ecosystem in Bangladesh', noting that the country must overcome challenges including job creation, climate risk management and increased investment in productive sectors to achieve LDC graduation and a trillion-dollar economy. Ashik said the groundwork has already been laid through Green Bonds, Social Bonds and the country's first Orange Bond, and what is now needed is policy support, market-driven innovation and attraction of international capital to build a strong Orange Capital market. The summit concluded with a session on 'Experience Sharing from Emerging Markets', moderated by IIX Senior Director (Research and Government Relations) Priyank Tiwari. IIX Indonesia's Antya Widita and IIX Director of Impact Partners (Investment Banking) Jonathan Abeywickrema shared experiences on inclusive financing, sustainable investment and the role of Orange Capital in capital market development across emerging economies, while also exploring how international best practices can be applied in the Bangladesh context.

Bangladesh Bank (BB) has provided an emergency liquidity support of Tk 2,500 crore for Islami Bank Bangladesh PLC to help the Shariah-based lender mitigate its severe cash crunch and resume suspended clearing operations. The central bank approved the liquidity support on Sunday, allocating the special fund directly into Islami Bank’s current account maintained with the BB, according to sources in both institutions. Following the financial injection, the bank's halted cheque clearing system has resumed. According to a top executive at Islami Bank, the bank has been facing an exceptional spike in cash demand. "Deposits are almost non-existent at the moment, while everyone is rushing to withdraw their funds," the official said on condition of anonymity. The liquidity strain escalated further following recent leadership shifts and administrative disputes. Before Eid-ul-Azha holidays on May 24, bank's then-chairman M Zubaidur Rahman resigned. Later that evening, former Bangladesh Bank Deputy Governor Md Khurshid Alam was appointed as an independent director and new chairman of the bank. Currently, five independent directors on Islami Bank's board, including the chairman, are central bank appointees. Following these changes, protests broke out under the banner of the "Islami Bank Sachetan Grahak Forum", pressing a seven-point demand that includes the removal of the new chairman. The unfolding situation at Islami Bank also triggered heated debates between treasury and opposition benches in Parliament. Amid growing public discourse, panic withdrawals intensified among clients, prompting Islami Bank to formally seek Tk 10,000 crore in emergency financial assistance from the central bank. Sunday's Tk 2,500 crore fund injection marks the first major deployment to stabilise the institution.

In a major move to inject vitality into a sluggish economy and generate employment, Bangladesh Bank (BB) on Thursday night announced a Tk 20,000-crore pre-refinancing scheme aimed at fully reviving closed and partially operational industries. Under this new policy, titled the "Pre-Refinancing Scheme for Assisting Closed Large-Scale Industry and Service Sectors," eligible business entities and corporate groups can secure working capital loans up to Tk 200 crore at a highly concessional interest rate of 7 percent. The initiative offers massive relief to manufacturers, given that the market interest rate across commercial banks currently exceeds 14 percent following recent monetary tightening. The central bank issued a comprehensive circular detailing the implementation guidelines late Thursday. This policy stems from a broader economic recovery roadmap announced on May 23 by Bangladesh Bank Governor Mostafizur Rahman, who promised a Tk 60,000-crore master fund to stimulate economic growth. According to the guidelines, commercial banks will pull funds from this central bank repository at a 4 percent interest rate and disburse it to qualified industrial and service enterprises at a maximum capped rate of 7 percent. All scheduled banks operating in Bangladesh are eligible to participate in the scheme. The central bank noted that the fund primarily targets large-scale manufacturing and service establishments that possess the necessary machinery and infrastructure but are suffering from production stoppages solely due to an acute shortage of working capital. Special emphasis will be placed on boosting export volumes and generating fresh employment opportunities. Partial or completely closed enterprises capable of resuming full operations will receive priority. Furthermore, efficient, functional companies that acquire or lease underperforming or closed external factories to revitalize them will also receive priority access to the credit facility. To maintain financial discipline, the central bank has imposed strict compliance checks. Borrowers must have a clean slate in the Credit Information Bureau (CIB) database, with no active loan defaults. Any business or entrepreneur with a record of money laundering or past credit misappropriation will be strictly barred from accessing the fund. Loan Utilization Rules: The tenure of the working capital loan will be a maximum of one year at the customer level, renewable based on actual performance and utilization. Borrowers will also enjoy a six-month grace period, meaning interest installment collections will only begin after the first six months. The policy strictly regulates how the loan can be spent. Companies can use the funds to cover up to four months of wages and allowances for workers and staff. It can also be utilized to clear utility dues (electricity, gas) and procure raw materials necessary for immediate production. To ensure transparency, all worker salaries must be routed directly into their respective bank accounts or verified Mobile Financial Services (MFS) accounts linked to their National Identity (NID) cards. Cash transactions are strictly prohibited. The central bank explicitly stated that these loans cannot be used to adjust, settle, or pay off any pre-existing bank liabilities or debts. Strict Monitoring & State Recognition: To prevent fund diversion, Bangladesh Bank has mandated a rigorous oversight framework. Lending banks must collect weekly sales and revenue reports from the borrowers. Bank representatives will be required to physically inspect the factory premises every three months to prepare compliance reports, while Bangladesh Bank reserves the right to conduct surprise spot inspections at any time. Borrowers must channel all business-related income and expenditures through a single, designated bank account. Failure to repay the funds on time will result in the central bank automatically deducting the outstanding amount directly from the respective commercial bank’s current account held with Bangladesh Bank, alongside a 2 percent punitive interest penalty. In a unique motivational approach, the central bank announced that companies, entrepreneurs, and banks that demonstrate successful implementation and actively contribute to the national economy through this scheme will be honored with official state recognition.

The government has introduced a newly designed Tk 5 currency note under the theme “Historical and Archaeological Architecture of Bangladesh,” which will enter circulation from Tuesday. According to a press release issued by the Finance Division, the new note bears the signature of Finance Secretary Dr Md Khairuzzaman Mozumder and will initially be available from the Motijheel office of Bangladesh Bank before being distributed through its other offices across the country. The new Tk 5 note measures 117 mm by 60 mm and features an image of Tara Mosque in Dhaka on the left side of the front panel. The middle portion carries a background design with Bangladesh’s national flower, the water lily, including leaves and buds. The reverse side of the note contains an image titled “Graffiti-2024.” The note has a predominantly light pink colour scheme and includes several security features. These include a 2 mm-wide embedded security thread visible from both sides when held against light, and a watermark showing the face of a Royal Bengal Tiger along with a bright electrotype watermark marked “5” and the monogram of the Government of Bangladesh. In addition, the front side contains repeated microprinted “BANGLADESH” text above the bluish guilloche pattern at the lower portion of the note. The Finance Division said all existing paper notes and metallic coins currently in circulation will remain valid alongside the new Tk 5 note. Considering the interest of currency collectors, Bangladesh Bank has also printed non-exchangeable specimen notes of the new Tk 5 design. These can be collected at a fixed price from the Bangladesh Bank Currency Museum in Mirpur.

Scheduled banks across the country will remain closed for seven consecutive days – from May 25 to May 31 – on the occasion of Eid-ul-Azha, according to Bangladesh Bank (BB). The central bank issued a notification on Monday stating that in accordance with the Ministry of Public Administration’s notification, all branches and sub-branches of scheduled banks will operate under normal working hours on May 23 (Saturday) and May 24 (Sunday), right before the holidays begin. Govt to cut bank borrowing in FY27 to spur private credit, curb inflation However, special arrangements have been made to facilitate the payment of salaries, bonuses, and other allowances to garment workers, as well as to keep import and export activities active ahead of the festival. To support this, bank branches located in garment-industrial zones, including Dhaka city, Ashulia, Tongi, Gazipur, Savar, Bhaluka, Narayanganj, and Chattogram, will remain open on a limited scale on May 25 and 26. According to the BB directive, during those two days, the office hours for these specific branches will be from 10:00am to 3:00pm, while transactions will be conducted from 10:00am to 1:00pm. Furthermore, bank branches, sub-branches, and booths situated in sea port, land port and airport areas have been directed to keep import-export activities functional on a limited scale. The central bank instructed the relevant desks to continue essential banking operations throughout the holiday period (from May 25 to May 31, excluding Eid day.

In a significant move to ease international travel for Bangladeshis, Bangladesh Bank (BB) has allowed the remittance of mandatory visa bonds and refundable security deposits required by foreign embassies, high commissions, and other visa authorities. The central bank issued a circular on Sunday, instructing Authorized Dealer (AD) banks to facilitate such payments on behalf of visa applicants. According to the new directive, banks are now permitted to issue international or virtual cards in the name of the applicant, specifically for this purpose. These cards can be pre-loaded with the necessary bond or security deposit amount. Furthermore, existing international cardholders can reload their cards under their travel quota to cover these specific costs. However, the central bank emphasized that these funds must exclusively be used for visa-related financial requirements. A key clause in the circular mandates the swift repatriation of these funds once the relevant embassy or authority refunds the bond or security deposit. “Banks are required to maintain separate registries to track these transactions. They must regularly monitor and report the progress of fund returns to the central bank,” stated in the circular. Before remitting any funds, banks must verify several essential documents, including-a valid passport of the applicant, a formal requirement letter or invoice from the embassy or relevant authority, and references or acknowledgment letters related to the visa application. The central bank clarified that these transactions can be processed through Exporter’s Retention Quota (ERQ) accounts, Resident Foreign Currency Deposit (RFCD) accounts, or international cards issued against such accounts. Industry insiders believe this decision will remove a major bottleneck for Bangladeshi travelers, students, and professionals applying to countries that require financial guarantees as a prerequisite for visa approval, making the overall process more transparent and accessible.

Bangladesh Bank has directed all commercial banks to set up dedicated counterfeit currency detection booths at cattle markets across the country to ensure the security of large-scale cash transactions during the upcoming Eid-ul-Azha. The central bank issued a circular in this regard recently asking banks to deploy note-counting and currency authentication machines to prevent the circulation of fake notes during the peak sacrificial animal trading period. According to the directive, each commercial bank must appoint a focal coordinating officer for the operation and submit their names, designations and contact details to Bangladesh Bank by May 17. For cattle markets in Dhaka North and South City Corporations, specific banks have been assigned individual markets to operate booths until the night before Eid. Outside Dhaka, Bangladesh Bank’s regional offices will coordinate the arrangement, while Sonali Bank will lead coordination in districts where the central bank has no branch presence. The circular also instructed that the booths must provide uninterrupted service throughout the trading period up to Eid night. Banks have been asked to maintain close coordination with local administrations, city corporations, municipalities and law enforcement agencies to ensure smooth operations and security. In Dhaka North, banks including Islami Bank, Shimanto Bank, AB Bank, National Bank, Al-Arafah Islami Bank, Eastern Bank, IFIC Bank, Meghna Bank, United Commercial Bank, City Bank, Agrani Bank, BRAC Bank, Dutch-Bangla Bank, Bank Asia, Jamuna Bank, Shahjalal Islami Bank and BASIC Bank have been assigned responsibilities. In Dhaka South, 19 banksincluding Premier Bank, Uttara Bank, Dutch-Bangla Bank, Bangladesh Krishi Bank, Dhaka Bank, Rupali Bank, Janata Bank, One Bank, Modhumoti Bank, Community Bank, Pubali Bank, Mercantile Bank, NCC Bank and Sonali Bank—have been deployed to operate detection booths across 13 designated cattle markets. Central bank officials said the initiative is aimed at safeguarding financial transactions during the festive season and ensuring confidence among buyers and sellers in a cash-intensive market.  

Credit card transactions by Bangladeshi nationals abroad and foreign nationals within Bangladesh witnessed a notable decline in February compared to the previous month, according to the latest report from the Bangladesh Bank. The central bank’s data shows that Bangladeshi cardholders spent Tk 377 crore abroad in February, a Tk 86 crore drop from the Tk 463 crore recorded in January. Among international destinations, the United States remained the top location for spending, accounting for Tk 54.03 crore. This was followed by Thailand (Tk 50.04 crore), Singapore (Tk 32.04 crore), and the United Kingdom (Tk 30.04 crore). Bangladesh Bank buys $60 million from banks to maintain exchange rate stability Other significant spending was recorded in Saudi Arabia, Tk 28 crore, India, Tk 25 crore, Malaysia, Tk 23 crore, and the Netherlands, Tk 17 crore, while Australia, the UAE, Ireland, and other countries accounted for the remainder. A similar downward trend was observed among foreign nationals using credit cards within Bangladesh. Spending by foreigners dropped to Tk 266.06 crore in February, down from Tk 344.04 crore in January—a Tk 78 crore decrease in a single month. US citizens were the highest spenders in Bangladesh, totaling Tk 86.09 crore. They were followed by citizens of Mozambique, Tk 35 crore, the United Kingdom, Tk 24 crore, and Australia, Tk 9.06 crore. Domestic credit card usage also saw a contraction. Transactions within the country fell by Tk 298 crore, sliding from Tk 3,720 crore in January to Tk 3,422 crore in February. Overall, the central bank report highlights a clear downward trajectory in credit card activity across all sectors during the month of February.

Bangladesh’s banking sector, which should operate as the backbone of the economy, is struggling to regain its footing due to a profound lack of good governance and deepening financial instability. According to the latest review by Bangladesh Bank, 17 banks failed to generate any net profit in 2024, while 11 banks gave up spending under Corporate Social Responsibility (CSR) altogether in 2025. Experts view these as a clear sign of the dire state of the industry, fueled by skyrocketing non-performing loans (NPLs), weak boards, and political interference. Masrur Reaz, Chairman of Policy Exchange Bangladesh and former senior economist at the World Bank, told UNB that the financial health of some banks has revealed the worsening situation of the sector. He pointed out that these banks will take several years to return to a good financial position. At the same time, the strict policy regulations and skilled management are also required for these banks. Towfiqul Islam Khan, an economist and the Additional Research Director at the Centre for Policy Dialogue (CPD), said that the scenario was a reflection of the economy of Bangladesh. The banking sector is like the blood circulation in the financial sector; while banks are in trouble, the overall economy will not be vibrant, he said. Zero CSR Spending by 11 Banks: A recent central bank report on CSR activities revealed that 11 banks made no contributions to social welfare in 2025. These institutions include: Janata Bank, Agrani Bank, BASIC Bank, Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank, Bangladesh Commerce Bank, National Bank, Global Islami Bank, Padma Bank, Union Bank, and National Bank of Pakistan. While CSR funds are typically allocated to sectors like education, health, and climate change, the zero expenditure by these banks suggests they are too preoccupied with internal financial and administrative crises to fulfill their social obligations. Profitability Crisis: Meanwhile, the central bank's performance report for 2024 identifies 17 banks that failed to earn a net profit. The list comprises several state-owned and struggling private lenders: Janata Bank, Agrani Bank, BASIC Bank, Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank, AB Bank, Bangladesh Commerce Bank, First Security Islami Bank, ICB Islamic Bank, IFIC Bank, National Bank, NRB Commercial Bank, Global Islami Bank, Padma Bank, Social Islami Bank, Union Bank, and National Bank of Pakistan. Analysts cite high NPLs, unearned interest income, rising operating costs, and irregularities in loan disbursement as the primary drivers of this unprofitability. Many of these banks are now facing such severe capital shortfalls that they struggle to maintain regular business operations. Interestingly, the report noted that six banks managed to contribute to CSR in 2025 despite recording no profits in 2024, likely by utilizing previous reserves—a move experts warn may challenge long-term stability. The crisis points toward systemic issues that have plagued the sector for years. The main challenges identified include: A significant portion of total loans is stuck with large borrowers who continue to enjoy new facilities without repayment. Political and influential interference in boardrooms often overrides commercial logic. Lack of profits has led to a sharp decline in Capital Adequacy Ratios (CAR). Also, reliance on manual systems and outdated software increases operational risks. Impact on the Economy: The fragility of the banking sector is casting a long shadow over the national economy. A weak banking system leads to reduced credit flow to industries, hindered investment, and slowed GDP growth. In 2025, the total CSR expenditure by the banking sector stood at Tk 345.05 crore, with Tk 98.44 crore going to education and Tk 85.64 crore to health. However, the fact that only a few strong banks carry the bulk of this expenditure highlights a massive disparity in financial health across the sector. Urgent Reforms Needed: The economists and industry insiders are calling for immediate intervention to stabilize the sector. Key recommendations include: 1. Strict Loan Recovery: Legal action against willful defaulters. 2. Board Accountability: Ensuring transparency and independence in bank management. 3. Digitalization: Modernizing risk management and banking software. 4. Policy Oversight: Strengthening CSR monitoring to ensure it remains a merit-based, profit-driven obligation. Without swift reformative steps, this deep-seated governance crisis and financial weakness pose a significant risk to the overall economic stability of Bangladesh.