Corporate governance and non-performing loans (NPLs) are critical concerns in the country’s banking sector according to the Bangladesh Bank governor. Speaking at the “Banking on Digital Transformation” summit organized by the Association of Bankers, Bangladesh (ABB), the governor emphasized the need for strong enforcement of prudential guidelines and regulations by top management, including CEOs of banks, to address the NPL issue. He stressed the importance of cultural changes, ethical practices, and proper training in the banking sector. The banking industry in Bangladesh witnessed a 16.8% year-on-year increase in default loans, reaching Tk 120,656 crore in 2022. Governor also highlighted the central bank’s plans to introduce a digital bank, an online credit scoring system, and a national debit card. The two-day event aimed to explore the digital transformation journey of Bangladesh’s banking industry, driven by increasing customer demand and investments in robust IT infrastructure.
Enforcing Rules Could Mitigate Banks’ NPLs
Industry: Bank, Financial
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