United News of Bangladesh

Bangladesh Bank on Wednesday urged all types of media to practice responsible journalism when reporting on the country's banking sector, cautioning that arbitrary calculations of "distressed loans" create unnecessary panic among the public. In a press release issued by the Department of Communications and Publications (DCP), the central bank clarified its position regarding recent media analyses derived from the newly published ‘Financial Stability Report (FSR) 2025’. The central bank noted that following the release of the FSR 2025, several newspapers and media published reports claiming that the banking sector's "distressed loan" ratio ranges anywhere between 45 percent, 59 percent, or even 60 percent based on their own calculations. Dismissing these figures, Bangladesh Bank stated that no internationally recognized financial policymaking body has defined a standard definition for "distressed loans." Generally, loans that yield no income or where installments are default are treated as distressed. However, the central bank clarified that unclassified rescheduled loans cannot be clubbed into this category because borrowers are actively and regularly paying back their designated installments. Furthermore, the banking regulator pointed out that under international best practices, written-off loans are completely removed from a bank's balance sheet, meaning they also cannot be mathematically categorized as distressed loans. According to the official data re-verified by the central bank, the actual Non-Performing Loan (NPL) or default loan ratio in the country's banking sector stood at 30.60 percent as of December 31, 2025. Bangladesh Bank expressed strong reservations over combining actual default loans with legally rescheduled and written-off loans to project an inflated distressed loan ratio. The regulator warned that such reporting distorts macroeconomic realities and sends highly misleading signals to both domestic and international financial stakeholders regarding the health of Bangladesh's economy. Considering the extreme sensitivity of the financial architecture and overall national interest, the central bank requested editors, reporters, and media houses to ensure maximum objectivity, depth, and precision when disseminating banking and economic data.

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.

Islami Bank Conscious Depositors’ Forum on Tuesday submitted a memorandum to the Bangladesh Bank Governor demanding a transparent, professional management structure to safeguard public money. The platform warned of launching a rigorous countrywide agitation if the central bank fails to immediately form an acceptable and professional board of directors, and hand the bank's ownership back to its genuine shareholders. The forum strongly criticided the centralidation of all administrative powers under a single central bank administrator, stating that running a massive financial institution without a fully functioning board is detrimental to corporate governance. They expressed apprehensions that a long-term administrative regime could inadvertently allow controversial individuals or remnants of the previous looting regimes to re-enter the management. The demands are immediate formation of a complete, honest, and professional board of directors, restoring the bank's ownership and shares to its genuine, original owners, establishing a special tribunal to try those involved in looting bank funds, implementing immediate steps to stabilize the bank and curbing negative propaganda, tracking down, freezing, and bringing back laundered wealth and assets from abroad. Besides, amending the Bank Company Act to permanently bar financial fraudsters from rehabilitation and withdrawing controversial statements regarding Islami Bank 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.

Mohammad Zahir Hussain, chairman (Current charge) of Islami Bank Bangladesh PLC, on Monday announced that a new, fully independent and neutral board of directors will be formed very soon to manage the country's largest private commercial bank. Zahir, who is also an executive director of Bangladesh Bank, was tasked with leading a single-member interim board following the dissolution of the entire board on Sunday. Now entire board of Islami Bank dissolved; administrator takes charge to maintain order Speaking to reporters at the bank’s head office in the capital's Dilkusha area, he also urged depositors to carry out their banking transactions smoothly and restore their faith in the institution, stating that "there is no scope for looking back now." "A complete five-member board of directors is in the process of being formed. The screening and verification process is currently underway. We want to appoint completely neutral and qualified individuals who can run this bank with utmost efficiency. I hope a strong, fair, and impartial board will be visible very shortly," Zahid said. He clarified that he is currently overseeing the bank's affairs under a temporary, single-member board framework with the primary objective of ensuring that the daily operations and services of the financial institution remain unhindered. At the press briefing, bank’s acting Managing Director Md Altaf Hossain expressed hope that depositors who had previously withdrawn their funds will return to the bank as stability is restored. He further highlighted that initial data from the bank's major branches indicates a significant positive shift in customer behaviour.  "Information gathered from our prominent branches reveals that account closures have dropped by nearly 75 percent compared to previous weeks. This is a clear indicator that public confidence is steadily returning to Islami Bank," Altaf said. Senior executives and high officials of the bank were also present at the briefing.

Association of Bankers, Bangladesh (ABB) has welcomed the central bank’s decision to dissolve the existing board of directors of Islami Bank Bangladesh PLC,  describing the move as a timely and prudent step to restore stability across the financial sector. A statement issued on Monday from the office of ABB Chairman and Managing Director of City Bank, Mashrur Arefin, expressed relief over the central bank's intervention, noting that the ongoing crisis at Islami Bank had spiraled beyond a single institution and threatened the broader banking industry. Now entire board of Islami Bank dissolved; administrator takes charge to maintain order According to the release, the apex body of bank executives had formally conveyed its deep concerns to the Governor of Bangladesh Bank on June 10, warning of the systemic risks associated with the unfolding situation. We conveyed that an early resolution would be beneficial for the industry, as the situation at Islami Bank was no longer an issue concerning a single institution; its impact was being felt across the banking sector, the ABB statement said.  Given that the dispute had acquired severe political overtones, the association had previously advised the regulator to seek a resolution through dialogue and consensus among relevant stakeholders. In this context, we believe the decision taken yesterday by the central bank is commendable. We hope it will restore stability at Islami Bank and rebuild the confidence of its depositors, investors, and stakeholders, the statement added. Highlighting the massive footprint of the country’s largest private commercial bank, the ABB emphasised that the stability of Islami Bank is inextricably linked to the national economy. The bank boasts nearly 30 million customers, a vast deposit and investment portfolio, the nation's largest remittance network, and a commanding share in international trade finance. The association pointed out that recent "mob-driven protests" at the bank's headquarters triggered widespread anxiety within the financial fraternity regarding institutional governance, liquidity preservation, and the confidence of both domestic depositors and foreign investors. The ABB expressed optimism that the appointment of an interim authority would allay these pressing concerns. The bankers' association outlined critical expectations for the revitalized institution, calling for substantial progress in establishing robust good governance, strict accountability, a banking environment entirely free from political influence, and the aggressive recovery of the bank's massive volume of non-performing loans (NPLs).

Expressing deep concerns over the lingering uncertainty surrounding Islami Bank Bangladesh PLC, the Islami Bank Sachetan Grahak Forum on Monday demanded the immediate formation of a fully-fledged, competent and professional board of directors to restore public trust in the bank. It emphasised that the recent appointment of an administrator by the central bank after dissolution of the regular board is not a permanent solution and could instead complicate the existing crisis. Prof Nur Nabi Manik, the convener of the forum, made the demands while reading out a written statement at a press conference held at the Islami Bank Tower in the capital's Dilkusha area. He pointed out that Islami Bank is not just an ordinary financial institution; it holds the deposits of millions of citizens, handles the major share of inward foreign remittances from expatriates, finances small entrepreneurs, and serves as a vital pillar of the country's rural economy. “Therefore, any disruption or decision regarding the bank directly impacts the overall stability of the financial sector.” Forum leaders mentioned that they had previously placed demands before Bangladesh Bank for the removal of the controversial chairman, the reinstatement of former Managing Director Omar Faruk Khan, and the establishment of an acceptable management structure. However, bypassing those demands, the central bank opted to dissolve the entire board and centralise all administrative powers under a single administrator, they said. The organisation asserted that running a major commercial bank under a long-term administrator-dependent system is undesirable, as it centralises decision-making and denies representation to vital stakeholders. It, however, acknowledged that the central bank's timely injection of emergency liquidity support and the removal of the controversial chairman provided some temporary relief to the ongoing operational impasse. Speakers at the press conference urged the government and the regulatory authorities to stop issuing contradictory statements regarding the bank's health, which they claimed intensifies panic among depositors. They requested the central bank to quickly transition from a temporary administrative regime to a permanent, professional management board to secure public money and protect the financial ecosystem.

In a dramatic regulatory move, Bangladesh Bank on Sunday dissolved the entire Board of Directors of Islami Bank Bangladesh PLC, including its newly appointed chairman, in what it said was a move to protect the interests of depositors and safeguard public money. The central bank removed all directors of the country’s largest Shariah-based commercial lender with immediate effect under the powers vested in it by the Bank Company Act, 1991. BB appoints observer to Islami Bank to restore discipline, protect depositors Bangladesh Bank Assistant Spokesperson Shahriar Siddiqui confirmed the development, noting that the unprecedented step was taken in the public interest to ensure good governance and maintain stability across the banking sector. According to a circular issued by the central bank on Sunday evening, the appointments of the chairman and all existing directors on the board have been cancelled. To maintain continuity in the bank's administration and supervisory operations, the central bank has vested all powers and duties of the dissolved board in Bangladesh Bank Executive Director Mohammad Johir Hossain.  He will exercise full managerial and administrative authority under Section 47(3) of the Bank Company Act, 1991, effectively serving as the administrator. The sweeping intervention follows intense scrutiny, severe liquidity challenges, and public controversies surrounding the management and leadership changes at Islami Bank. Financial analysts believe it is too early to tell whether the direct takeover of the board by the regulatory authority can indeed be a step towards restoring regular financial operations, calming panic-stricken depositors, and stabilizing the country's broader financial landscape.

Bangladesh Association of Banks (BAB) has strongly demanded the swift identification and legal recovery of embezzled and looted funds from the banking sector to protect the interests of ordinary depositors. Welcoming the proposed national budget for fiscal year 2026-27, the apex body of private commercial bank owners, stated that merely recapitalising weak banks will not make the financial sector sustainable in the long run unless past irregularities and financial plundering are effectively resolved. Steps underway to resolve Islami Bank crisis, emergency liquidity support to be provided: Governor Abdul Hai Sarker, Chairman of BAB issued a post-budget statement following the presentation of the national budget in parliament. The government has allocated approximately Tk 40,000 crore for weak banks, which it termed a crucial step toward restoring stability in the banking sector. However, the association emphasised that to reap the actual benefits of this recapitalisation, the immediate recovery of looted assets must be ensured simultaneously. Strengthening banks with public money can only be successful when those who abused these funds are held strictly accountable, BAB added. The organisation further stressed that visible and punitive actions against those responsible are imperative to rebuild depositors' trust. "Legal action must be taken against willful defaulters and those who have crippled the banking system. Under no circumstances should they be allowed back into the financial sector," the statement reads, adding that such steps would not only restore financial discipline but also deter future irregularities. As part of comprehensive banking sector reforms, BAB highlighted the necessity of forming an effective Asset Management Company (AMC). Such an institution could play a pivotal role in reducing non-performing loans (NPLs) of weak banks and strengthening their balance sheets, it said. BAB also called for clear and transparent policy formulation regarding the management and disposal of shares and assets acquired through illicit financial irregularities. Warning of potential long-term risks, the association cautioned that if the recovery process is not executed effectively, bailouts using state funds will only offer temporary relief without yielding the desired structural results. It urged the government to implement a tripartite approach focusing equally on "Reform, Recovery, and Accountability" alongside the recapitalisation process.

Bangladesh Bank Governor Md. Mostaqur Rahman has assured depositors of Islami Bank Bangladesh PLC that the central bank is taking immediate measures to resolve the bank's liquidity challenges, including providing emergency liquidity support. "Depositors will not face any inconvenience. They will be able to withdraw their money at any time," the Governor said while responding to questions from journalists regarding the banking sector at a post-budget press conference for FY2026-27 held at the Osmani Memorial Auditorium in Dhaka on Friday. BB appoints observer to Islami Bank to restore discipline, protect depositors He stated that the central bank has a number of regulatory tools at its disposal to manage the situation, and some of these collective measures will be implemented within the coming days. The Governor's remarks come at a time of heightened concern over mounting liquidity pressures at the country's largest Shariah-based commercial bank, which has sparked growing anxiety among depositors regarding regular access to their funds. Governor Rahman explicitly confirmed that any necessary emergency liquidity support required to stabilize Islami Bank will be fully provided by the central bank to safeguard public deposits and maintain overall financial sector stability.