The interim government has taken a significant step towards reforming the country’s banking sector by announcing the formation of a dedicated commission aimed at implementing sustainable reforms. The decision, which has been a long-standing demand of economists and financial experts, was made during a high-level meeting between interim government Chief Adviser Dr. Muhammad Yunus and Bangladesh Bank Governor Ahsan H. Mansoor.
The government also plans to develop and publish an action plan within 100 days, focusing on the overall situation and necessary reforms for the financial sector. This move is seen as a critical initiative to stabilize and strengthen the country’s banking system. During the meeting, it was also decided to expand the band for inter-bank foreign exchange transactions from 1% to 2.5%, an initiative aimed at increasing liquidity in the foreign exchange market. The decision reflects the government’s commitment to addressing the liquidity challenges that have been affecting the market.
The office of the chief adviser urged the public to remain patient as the government implements measures designed to bring down inflation and stabilize the economy. The statement emphasized that the benefits of these reforms would take time to materialize. The call for a banking commission has been ongoing since 2014, with economists and researchers advocating for a body to assess the sector’s overall health, identify irregularities, and ensure sustainable development. In response to these demands, former finance minister Abul Mal Abdul Muhit announced plans to form a bank commission. Later, during the presentation of the Awami League’s first budget after the 2018 elections, then-Prime Minister Sheikh Hasina also declared the formation of a bank commission in the national parliament. However, the initiative did not come to fruition.
The formation of this commission marks a crucial step forward in addressing the challenges facing Bangladesh’s banking sector. As the interim government takes these bold measures, there is cautious optimism that the sector will see much-needed reforms and stability in the near future.
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