Bangladesh Bank extended emergency funds to National Bank, Islami Bank Bangladesh, and AB Bank to address liquidity shortages and support their year-end balance sheets. National Bank borrowed Tk 6,000 crore, Islami Bank Tk 5,500 crore, and AB Bank Tk 1,000 crore overnight at a rate of 11.50 percent. AB Bank also secured an additional Tk 200 crore for long-term liquidity.
The banks used “demand promissory notes” as collateral due to a lack of securities. This assistance was intended to meet regulatory cash and liquidity requirements and maintain depositor confidence.
The three banks face ongoing financial struggles due to poor governance, high default loans, and liquidity crises. Critics, including economists, argue that such interventions discourage transparency and fail to address underlying issues in the banking sector, urging reforms for sustainable improvement.
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