United News of Bangladesh

The Bangladesh Bank Officers' Welfare Council has issued a seven-point demand to the authorities, calling for comprehensive legal reforms to establish the full autonomy of the central bank. The demands were formally presented during a press conference held at the central bank’s headquarters on Thursday (February 5). The council emphasized that the ‘Bank Company Act-1991,’ and other related regulations must be amended to ensure the central bank can function independently and enforce good governance across the financial sector. "To ensure an effective and independent role for the central bank, reforming the legal framework is essential," said in the briefing. The seven-point charter includes several critical administrative and policy changes. Such as- Cancellation of Contractual Appointments: The Council demanded the immediate termination of all advisors, consultants, and officials appointed on a contractual basis without transparent recruitment or proper evaluation. Institutional Protection: Ensuring legal and professional protection for officials who face harassment while performing their official duties. Promotion and Recruitment: Resolving the existing stagnation in the recruitment and promotion process for regular central bank staff. Focused Leadership: Ensuring the Governor devotes active time and attention specifically to the policy and interests of Bangladesh Bank. Curbing Misleading Statements: Urging officials to refrain from making inconsistent or whimsical remarks to the media regarding central banking policies. Bangladesh Bank buys another $196.5 million to stabilize forex market Golam Mostafa Srabon, General Secretary of the Officers' Welfare Council, noted that these demands are not new. A memorandum was first submitted to the Interim Government’s Finance Adviser, Dr. Salehuddin Ahmed, in August 2024. The Council followed up with the Governor on November 5 and again on December 23 of last year, specifically highlighting the need to cancel unnecessary contractual appointments. Despite repeated requests, the Council claims significant action has yet to be taken.  

Bangladesh Bank (BB) purchased an additional $196.5 million from 16 banks on Thursday, continuing its aggressive streak of dollar procurement to manage the country's foreign exchange market. The central bank executed the purchase at a cut-off rate of Tk 122.30 per US dollar, Arif Hossain Khan, Executive Director and Spokesperson of Bangladesh Bank, confirmed this. With this latest move, the central bank’s total dollar purchases for the month of February have reached $586 million in just five days. The total acquisition for the current fiscal year FY2025–26 now stands at a substantial $4.51 billion. This week has seen consistent intervention by the central bank. Previously on Wednesday (Feb 4), $171 million was purchased from 16 banks. Before that on Sunday (Feb 2), another $218.50 million was purchased from 16 banks. The central bank has maintained a steady exchange rate of Tk 122.30 for most of its recent transactions. Earlier interventions in January included: Jan 29: $55 million from five banks. Jan 20: $45 million from two banks. Jan 12: $81 million from 10 banks. Jan 6: $223.50 million from 14 banks. Bangladesh Bank buys dollars worth $3.75 billion in 6 months to maintain exchange rate stability According to central bank sources, the primary goal is to stabilize the exchange rate and prevent the Taka from appreciating too rapidly due to a surge in remittance inflows and export earnings. By purchasing the "excess" supply of dollars from commercial banks, the central bank aims to strengthen foreign reserves, support exporters & remitters, and manage liquidity.  

Bangladesh Bank (BB) has dissolved the existing board of directors of Uttara Finance and Investments Limited and formed a new board to rescue the struggling non-bank financial institution (NBFI) from deep-rooted loan irregularities. The listed company shared this information through the Dhaka Stock Exchange (DSE) on Thursday (February 5). Under the Financial Company Act, 2023, the central bank has appointed five new directors to the board. Md. Mukhtar Hossain has been named the new Chairman and will serve as an independent director. Read More: Bangladesh Bank reverses policy, allows depositors of merged banks to earn profits Other newly appointed independent directors include Mohammad Shafiul Azam, Md. Niamul Kabir, Md. Rafiqul Islam (FCS). Additionally, Md. Mahbub Alam has joined the board as a director. According to central bank sources, the move aims to ensure transparency and restore corporate governance within the institution. Uttara Finance has been under scrutiny for failing to publish regular financial reports since 2019. However, an audit report for the year 2020, released on October 6 last year, revealed a staggering financial decline. After taxes and expenses, the company recorded a net loss of Tk 435.54 crore in 2020. The annual operating loss stood at Tk 108.32 crore. By the end of 2020, the total capital shortfall reached Tk 711.55 crore. This includes a core capital deficit of Tk 59.34 crore and a risk-based capital deficit of Tk 652.21 crore. Central bank officials hope that the reconstitution of the board will bring positive changes to the management and financial health of the company, which has been reeling from years of mismanagement and unauthorized transactions. Read More: Bangladesh Bank buys $45mn from two banks to bolster reserves

Bangladesh Bank (BB) purchased an additional US $171 million from 16 commercial banks on Wednesday as part of ongoing efforts to stabilise the country’s foreign exchange market. The dollars were bought at a cut-off rate of Tk 122.30 per US dollar, a central bank official said. This intervention follows a major purchase on Monday when the central bank acquired $218.5 million from 16 banks at the same rate. With these recent transactions, BB’s total dollar purchases in February have reached $389.5 million in just four days. Aggressive Accumulation in FY2025-26 Throughout the current fiscal year, Bangladesh Bank has been actively buying dollars to curb rapid Taka appreciation and strengthen foreign exchange reserves. The total purchases for FY2025-26 have reached $4.32 billion. Recent Major Interventions: Feb 4: $171 million from 16 banksFeb 2: $218.5 million from 16 banksJan 29: $55 million from 5 banksJan 20: $45 million from 2 banksJan 12: $81 million from 10 banksJan 6: $223.5 million from 14 banksAll transactions were executed at a uniform cut-off rate of Tk 122.30. Read More: Bangladesh Bank directs banks, NGOs to boost awareness on referendum Rationale Behind Market Intervention Arif Hosain Khan, Executive Director and Spokesperson of Bangladesh Bank, confirmed the latest purchase, noting that the central bank employs an auction-based system to manage liquidity. Key drivers include: Remittance Surge: Inward remittances through formal banking channels have reached record levels, with January 2026 alone seeing $3.17 billion, leaving banks with surplus dollar holdings. Exchange Rate Management: By setting a cut-off rate, the central bank aims to establish a floor for the Taka, supporting exporters and remitters. Reserve Strengthening: Dollar purchases are helping rebuild the country’s foreign exchange reserves, which stood at $28.51 billion (net) as of December 2025. Banking insiders say that while the dollar crisis of previous years has eased, active participation by the central bank remains critical to prevent market volatility and ensure a predictable exchange rate for trade planning.

Bangladesh Bank Governor Ahsan H Mansur on Thursday dismissed rumours surrounding the newly formed Sammilito Islami Bank, alleging that vested interests are paying individuals to provoke unrest as part of a planned smear campaign. Speaking at an emergency press briefing at the central bank headquarters in Dhaka, Mansur said organised efforts were under way to incite disorder at bank branches, including the filming of provocative videos, particularly in the Chattogram region. Reaffirming the new bank’s financial stability and continued state support, he said authorities were monitoring the situation closely and warned that law enforcement agencies would be deployed if needed. Read More: Bangladesh Bank to ease rules, give banks more freedom: Governor “We believe in democratic practices and everyone has the right to protest. But certain vested interests are paying people to create chaos. These efforts will not succeed,” Mansur said. The governor sought to reassure depositors amid controversy over profit distribution following the consolidation of several troubled Islamic banks into Sammilito Islami Bank. He said the government had provided ‘extraordinary support’ using public funds to stabilise the institution, stressing that the state could not shoulder the entire financial burden alone. “Burden sharing is a global practice,” Mansur said, pointing out that while some depositors received a 4% profit for 2024 and 2025 due to past losses, they had benefited from returns of as much as 12% to 13% in earlier years. From this year, depositors will receive market-based profit rates, currently set at 9.5%, he said. “In the coming days, they will receive 9.5%. What more could one ask for?” Mansur added. Read More: Too many banks; Bangladesh needs only 10–15: Governor Regarding criticism over compliance with AAOIFI standards for Islamic finance, the governor said the issue was not about introducing new rules but ensuring the survival of a functioning bank. “If the bank doesn’t exist, who will pay the profit?” he said. Mansur also rejected rumours that he was planning to take leave or resign, calling the claims baseless. “I have not submitted any leave application, no leave has been granted, nor do I have any intention of taking leave.” He said Bangladesh Bank had undertaken more reforms in the past year than in the previous 14 to 15 years combined, scaling back non-essential regulatory controls to focus on core priorities such as foreign exchange management and financial market development. The governor urged the public to verify information directly rather than rely on rumours. “Go to the banks yourselves, listen and understand the situation. In Bangladesh, there is no end to rumours,” he added.

Bangladesh Bank has reversed a contentious policy that barred depositors of five recently merged banks from receiving profits for 2024 and 2025, following widespread criticism and ethical concerns. The central bank’s move restores interest payouts, easing tensions among affected account holders. Under the new decision, depositors will now receive a 4 percent profit rate for those two years. Starting from the current year (2026), market-based profit rates will apply. Currently, the bank has announced a profit rate of approximately 8.5 percent. Read more: Banking sector reform can’t be done overnight: Salehuddin The central bank communicated this updated policy via a letter sent to the administrators of the affected banks on Wednesday (January 21). Backtrack on ‘Haircut’ Policy The reversal comes just a week after a January 14 directive which stated that no profit would be applicable to any deposits from January 1, 2024, to December 28, 2025. That letter even suggested that any profit already withdrawn by depositors would be "adjusted" from their principal amount, a process known as a ‘haircut’. The initial announcement sparked widespread outrage. Many depositors gathered at various branches of the newly formed Sammilito Islamic Bank PLC to express their anger. Furthermore, the Central Shariah Board intervened, stating it was ‘not Shariah-compliant’ to shift the burden of embezzlement, caused by the negligence of the banks and the regulator, onto the depositors. Read more: Depositors of 5 merged banks can withdraw Tk 2 lakh initially, then Tk 1 lakh every 3 months  The government recently created Sammilito Islamic Bank PLC by merging five Shariah-based lenders—Exim Bank, Social Islami Bank, First Security Islami Bank, Global Islami Bank, and Union Bank—that were weakened by massive loan irregularities and embezzlement. These banks hold approximately Tk 1.42 lakh crore in deposits from nearly 76 lakh depositors. In contrast, out of the Tk 1.92 lakh crore distributed as loans, roughly 77 percent has become defaulted. Shariah and Accountability Internal debates within the central bank and insights from Islamic banking experts played a key role in this policy shift. Experts pointed out that: Mudaraba Principles: In Shariah banking, depositors are "Sahib-al-Mal" (capital providers) and the bank is the ‘Mudarib’ (manager). Liability for Negligence While depositors normally share business losses, Shariah standards (specifically AAOIFI standards followed in Bangladesh) dictate that if a loss occurs due to the bank's negligence, misconduct, or breach of trust, the bank alone must bear the liability. Read more: Bangladesh Bank to ease rules, give banks more freedom: Governor By reinstating the profit, the central bank acknowledges that depositors should not be penalised for the systemic failures and financial crimes that led to the banks' instability.

The depositors of five crisis-hit Shariah-based banks in Bangladesh will have to forgo profits on their savings for two years as the central bank moves to stabilise the lenders ahead of a planned merger. Bangladesh Bank has ordered a ‘haircut’ on profits accrued during 2024 and 2025, meaning depositors will not receive any returns for that period and will see their account balances reduced. The directive follows what the regulator described as international resolution practices for distressed banks. Institutional deposits to be converted into shares as Bangladesh Bank finalises 'Sammilito Islami Bank' merger The decision was conveyed on Wednesday through letters sent to administrators of First Security Islami Bank, Global Islami Bank, Union Bank, Exim Bank and Social Islami Bank. The five banks have been merged into a single entity, ‘Sammilito Islamic Bank PLC’. Under the instruction, all deposit accounts must be recalculated based on their status as of December 28, 2025. Any profit credited between January 1, 2024 and December 28, 2025 must be removed, with the final balance determined after applying the prescribed haircut. “To ensure the balanced implementation of the Resolution Scheme, all deposit accounts must be recalculated,” the central bank said in its letter, adding that the process should be completed swiftly. Bank Merger: 'Sammilita Islami Bank' receives final approval Bangladesh Bank officials said the lenders incurred heavy losses over the two-year period, leaving them unable to distribute profits to depositors. Prior to the directive, the banks had offered profit rates ranging from 7 percent to 9 percent on deposits. According to central bank data, the five banks collectively serve about 7.5 million depositors and hold roughly Tk142,000 crore in deposits. Their total outstanding loans stand at around Tk193,000 crore, a large portion of which is classified as defaulted. The move means depositors will lose not only two years of expected earnings but will also experience a direct reduction in their account balances — an unusually severe step in Bangladesh’s banking sector. It follows an earlier decision in which the share value of the five banks was declared zero, wiping out investments held by sponsors and shareholders. Exim Bank was previously controlled by Nazrul Islam Mazumder, former chairman of the Bangladesh Association of Banks. The remaining four lenders were controlled by Saiful Alam, head of the S. Alam Group. Now a writ on the 5 banks' merger filed with HC Both were widely known as close associates of ousted Prime Minister Sheikh Hasina and allegedly held significant shareholdings while securing large loan facilities through various entities. The merger marks one of the most sweeping banking restructurings undertaken by Bangladesh Bank as it seeks to contain systemic risk and restore confidence in the Islamic banking segment.  

Bangladesh’s private sector risks a tightening credit environment as government borrowing from the banking system has surged to nearly Tk 60,000 crore in the first half of the current fiscal year, raising concerns about reduced lending capacity for businesses. According to Bangladesh Bank data, the government’s net borrowing from banks reached Tk 59,756 crore between July 1 and January 4 of FY2025–26. The amount accounts for more than 57 percent of the full-year borrowing target of Tk 1.04 lakh crore, surpassing the halfway mark well before the fiscal year’s midpoint. The pace of borrowing marks a sharp escalation from a year earlier. In the same period of FY2024–25, the government’s net bank borrowing stood at Tk 8,312 crore, meaning the current figure represents an increase of 619 percent. Read more: Govt exceeds IMF-set limit on external borrowing: Dr Salehuddin Although the government initially repaid a small portion of its bank liabilities at the start of the fiscal year, borrowing accelerated rapidly amid mounting fiscal pressures. Economists cite a combination of revenue shortfalls, declining foreign aid and rising expenditure commitments as key drivers behind the shift. “The government is not meeting its revenue targets, and expected foreign loans are not arriving on time,” said Towfiqul Islam Khan, economist and additional research director at the Centre for Policy Dialogue (CPD). "Consequently, the government is forced to lean on the domestic banking sector to cover the deficit," he said. Bangladesh Bank data show the government’s total outstanding debt to the banking system has climbed to Tk 6.10 lakh crore. Of the borrowing undertaken so far this fiscal year, Tk 35,750 crore has come from commercial banks, while Tk 24,006 crore has been taken from the central bank. Read more: IMF limits Bangladesh’s foreign borrowing Business leaders warn that heavy public-sector borrowing risks crowding out private investment by absorbing a significant share of available bank liquidity. Reduced access to credit could delay investment decisions, constrain production capacity and slow job creation, they say. Syed Mahbubur Rahman, managing director and chief executive officer of Mutual Trust Bank Limited, said the banking sector has been navigating a difficult period amid a broader erosion of confidence. He noted that while the economy and banking system have stabilised, growth has slowed due to the impact of “severe mismanagement of the macroeconomic situation”. “Excessive government borrowing reduces the capacity of banks to support the private sector,” said Abdul Haque, a prominent business leader and former director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI). “This hampers employment and has a negative ripple effect across the entire economy," he said. Read more: NPL crisis chokes private credit growth, endangers Bangladesh's economic recovery: Experts Analysts caution that unless revenue collection improves and public spending is managed more effectively, continued reliance on bank financing could undermine private-sector activity and weigh on Bangladesh’s longer-term economic growth.

Bangladesh recorded a historic $17.17 billion in inward remittances during the first six months and seven days of fiscal year 2025–26, underscoring the resilience of overseas earnings and providing crucial support to the country’s foreign exchange reserves amid global trade headwinds. The inflow marks a strong year-on-year increase from the same period of FY2024–25, when remittances totalled about $14.31 billion. The latest figure represents an additional $2.86 billion, or nearly 19.9 percent growth, building on momentum from FY25, a record year in which annual remittances crossed the $30 billion threshold for the first time. Bangladesh Bank Executive Director and Spokesperson Arif Hossain Khan attributed the sustained growth to a combination of structural and policy-driven factors. Read more: Bangladesh sees $1.12bn in remittances in first 10 days of January He cited restored confidence in formal remittance channels following the political transitions in late 2024, which prompted a shift away from the illegal “hundi” system. Improved transparency and a growing sense of economic patriotism among expatriates have encouraged greater use of banking channels, he said. The stabilisation of the taka against the US dollar has also played a critical role, reducing speculative behaviour. With a market-based exchange rate now in place, remitters are no longer delaying transfers in anticipation of sudden currency depreciation. Government incentives remain another key driver, with the continued 2.5 percent cash incentive encouraging low-income migrant workers to send money through official platforms. Besides, expanded digital remittance services, including mobile financial services and fintech solutions, have made transfers faster and more accessible, particularly for workers in the Middle East and Southeast Asia. Bangladesh received $2.47 billion in remittances in July, $2.42 billion in August, $2.68 billion in September, $2.56 billion in October, $2.88 billion in November, and $3.22 billion in December. The data show an average monthly inflow of more than $2.42 billion over the past six months. This strong remittance performance is influencing policymakers to reconsider borrowing from the International Monetary Fund under stringent conditions. Professor Mustafizur Rahman, Distinguished Fellow of the Centre for Policy Dialogue (CPD), told UNB that the remittance surge is offsetting recent weakness in the export sector, which showed a slight contraction in December 2025. According to the Asian Development Bank (ADB) and local economists, robust remittance inflows are expected to be a key driver of consumption and GDP growth in 2026. As of early January 2026, Bangladesh’s gross foreign exchange reserves have benefited significantly from the inflows, standing at around $33 billion under traditional calculation, providing the government with added fiscal space to manage external debt obligations and import costs, he said. Syed Mahbubur Rahman, Managing Director and CEO of Mutual Trust Bank Limited (MTB), said confidence in the banking system has been restored, prompting expatriates to remit funds through formal channels. He noted that exchange rate stability and a normalised curb market have reduced the appeal of hundi transactions, which deprive remitters of the 2.5 percent incentive or more. Read more: Remittance inflow exceeds $632 million in first six days of December “In such a situation, sending remittance through illegal hundi is a loss for remitters,” he said. Mahbubur Rahman added that Bangladesh Bank’s policy measures have further encouraged migrant workers and non-resident Bangladeshis to send their hard-earned money through legal channels.

Bangladesh Bank announced plans to issue the ‘Bangladesh Government Special Sukuk-1’, a Shariah-compliant bond worth Tk 10,000 crore, to finance selected national infrastructure and welfare projects. The decision was finalised after meetings held last week by the central bank’s Shariah Advisory Committee under the Debt Management Department, which were presided over by Bangladesh Bank Deputy Governor Dr Md Kabir Ahmed. According to the central bank, the Sukuk will have a tenure of 10 years and carry an annual profit rate of 9.75 percent. Read more: Dhaka’s skyline transforms as flat owners reach 3.5 lakh The bond will be issued based on the ‘Ijarah’ (leasing) method, a Shariah-compliant financing structure approved by the committee. Proceeds from the issuance will support seven housing projects for government employees constructed by the Public Works Department. Besides, the funds will be used for specific rail services operated under Bangladesh Railway, underscoring the government’s focus on both housing and transport infrastructure. The ‘Special Sukuk-1’ is scheduled for issuance on January 14, 2026, through a private placement in favour of Sammilito Islamic Bank PLC. The Sukuk represents part of Bangladesh’s ongoing efforts to leverage Shariah-compliant financing instruments to fund public projects while providing investors with profit-generating opportunities that align with Islamic finance principles. Read more: House Rent Issues in Dhaka: A Growing Concern