Staff Reporter :
Bangladesh Bank Governor Dr Ahsan H Mansur has said that irregularities within the country’s banking sector during the previous administration have already been identified, but the former government had obstructed the implementation of corrective measures.
Speaking at a press conference on Monday, held at the central bank’s headquarters in Dhaka, Dr Mansur underlined that meaningful reforms in banking supervision will not be effective unless accompanied by broader reforms in the political landscape. The event was held ahead of the planned amendments to the Bank Company Act and was themed “Risk-Based Supervision.”
He stressed the need for political actors to recognise the consequences of interference in the financial system and called for greater political accountability. “Without correcting the political system, risk-based supervision in banking cannot deliver its full effectiveness,” the governor remarked.
As part of the upcoming reforms, Dr Mansur outlined key measures to enhance governance in the banking sector. One such measure includes the appointment of independent directors. Banks will be required to select independent directors from a panel vetted and approved by the Bangladesh Bank. If a bank wishes to appoint someone outside the panel, that individual will need to pass a “fit and proper” assessment conducted by the central bank.
He also mentioned plans to limit the number of board members from the same family and ensure that at least 50 percent of a bank’s board comprises independent directors. If any bank is found to be unable to operate independently under these conditions, the central bank may consider taking control of it.
In response to a question, the governor hinted at the possible restructuring of boards in some Shariah-based banks, pending a review of their operational performance.
The central bank is currently introducing a revamped Risk-Based Supervision (RBS) framework. The system includes comprehensive policy documentation, risk matrix development, and model supervisory reporting aimed at identifying and mitigating credit, market, operational, legal, regulatory, and strategic risks.
Under the new framework, all 61 scheduled banks will be brought under 12 supervisory groups within the central bank. This integrated structure will enable real-time monitoring of financial risks across the banking sector. So far, 20 banks have already been brought under the new system, and the remaining banks are expected to be integrated by 31 December 2025.
The reforms mark a significant shift in Bangladesh Bank’s approach to financial oversight, aiming to strengthen transparency, reduce systemic risks, and restore confidence in the banking sector.
