A central bank report reveals that the liquidity situation of six Shariah-based banks has deteriorated further. These banks have issued significantly more loans than the deposits they have received, leading to increased deficits in their current accounts with the central bank. Despite lending to these banks without collateral and maintaining transaction accounts, the central bank’s oversight is insufficient, failing to resolve the crisis. As of March 2024, deposits in these banks decreased by Tk 4,301 crore, while loan disbursements increased by Tk 10,752 crore. The loan-to-deposit ratio (ADR) rose to 99%, up from 92% in December 2023. The liquidity surplus dropped significantly from Tk 5,647 crore to Tk 605 crore. Despite facing liquidity shortages, these banks continue aggressive loan disbursements. They are also struggling to maintain the required CRR and SLR, resulting in substantial deficits in their current accounts. As of May 2024, five banks had a total deficit of Tk 16,439 crore in their current accounts with the central bank. This situation necessitates urgent intervention from the central bank to restore financial stability.
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