Bangladesh Central Bank Mobilizes Financial Institutions for National Referendum Awareness
Dhaka, Bangladesh – In a significant move to ensure the success and meaningful participation in the upcoming national referendum, Bangladesh Bank, the nation’s central bank, has issued directives to all scheduled banks and non-governmental organizations (NGOs). The aim is to actively engage the public and foster widespread understanding of the referendum’s importance.
These instructions were formally communicated during a crucial “Bankers’ Meeting” held at the Bangladesh Bank headquarters. The meeting, chaired by Governor Ahsan H. Mansur, saw the participation of four deputy governors and the managing directors of every private commercial bank operating within the country.
Key Initiatives for Referendum Awareness:
The central bank has mandated a visible presence of referendum awareness materials across the banking network. Specifically, each bank branch nationwide is required to display a minimum of two banners dedicated to the referendum. This measure is designed to provide citizens with clear and accessible information regarding the referendum’s objectives and its significance to the nation. This directive builds upon an earlier guideline issued by the Chief Adviser’s Office, underscoring the national importance of the initiative.
Furthermore, Bangladesh Bank has encouraged financial institutions to leverage their Corporate Social Responsibility (CSR) funds to support NGOs actively involved in grassroots awareness campaigns. The central bank official stated, “If NGOs initiate field-level campaigns to educate the public about the referendum, banks can support them through CSR allocations to ensure a wider reach.” This collaborative approach aims to amplify the message and ensure it reaches diverse segments of the population.
Broader Financial Landscape and Policy Directives:
Beyond the immediate focus on the referendum, the Bankers’ Meeting also delved into several critical aspects of the national financial landscape, addressing key indicators and outlining future policy directions.
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Non-Performing Loans (NPLs): A positive development was noted regarding the reduction of non-performing loans. At the close of December, NPLs in the banking sector reportedly decreased to 30.34 percent. When excluding the five recently merged banks, the NPL rate stands at a more favorable 24.53 percent.
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Loan Restructuring and Risk Mitigation: Governor Mansur issued a directive for a thorough review and overhaul of micro and digital nano-loan programs. The objective is to implement robust mechanisms to prevent these loans from being disbursed to “risky” or “bad” borrowers, thereby safeguarding the stability of the banking sector.
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Promoting Financial Literacy through School Banking: To cultivate a culture of saving and financial responsibility from an early age, a new requirement has been introduced for branch managers. Each branch manager is now obligated to visit at least two schools annually. The purpose of these visits is to actively encourage students to open bank accounts, thereby introducing them to formal banking services.
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Foreign Exchange Reserves: The central bank reported a positive trend in foreign exchange reserves, indicating an upward trajectory. Officials are optimistic about further growth, anticipating an increase in remittance inflows, particularly in the lead-up to the upcoming Ramadan and Eid-ul-Adha festivals. This influx is expected to bolster the nation’s foreign currency holdings.
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Facilitating Foreign Investment: The meeting highlighted the government’s ongoing efforts to streamline approval processes for foreign investors. This initiative aims to attract more foreign direct investment into the country. Concurrently, reforms to the Foreign Exchange Regulation Act are in progress, which are expected to further enhance the ease of doing business for international entities.
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Interest Rate Policy: Addressing concerns about interest rates, the central bank clarified that a reduction is not currently feasible. This stance is attributed to inflation not yet reaching the desired target levels. Nevertheless, Bangladesh Bank is actively developing strategies to bring interest rates to a more tolerable level as expeditiously as possible, balancing inflation control with economic growth objectives.
Masrur Arefin, Chairman of the Association of Bankers, Bangladesh (ABB), affirmed the banking sector’s unwavering commitment. He emphasized that banks are dedicated to ensuring the referendum’s success while simultaneously maintaining the positive momentum observed in foreign exchange reserves and remittance inflows, demonstrating a dual focus on national civic duties and economic stability.
