The Centre for Policy Dialogue (CPD) has called on the government to prioritize reducing bad loans and improving governance in the banking sector to address ongoing challenges. The think-tank proposed strengthening commercial banks, upholding the independence of the Bangladesh Bank, creating a conducive legal environment, and establishing a banking commission. It highlighted that non-performing loans (NPLs) in Bangladesh have more than tripled over the past decade, affecting both state-run and private banks.
According to Bangladesh Bank’s Financial Stability Report, gross NPLs amounted to Tk 120,649 crore in 2022, rising to Tk 377,922 crore when considering written-off and rescheduled loans. The report also noted that banks collectively set aside Tk 79,679 crore, falling short of the required loan loss provisioning of Tk 98,941 crore as of the second quarter of FY 2023-24.
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