In order to save Bangladesh’s weak banks, the central bank printed money to provide liquidity for ninety days. However, as promised, the banks have failed to repay a single taka. This plan to provide liquidity support to certain weak banks has drawn criticism from the International Monetary Fund (IMF) delegation in Dhaka.

Nonetheless, the nation’s experts believe that the aid given in this way will not cause any issues in terms of obtaining funds from the IMF.

They stated that there will be no barriers to the banks receiving the financial aid because a number of requirements have already been fulfilled, but there may be objections to some of them.

However, the IMF has been expressing concerns about the strategy to sustain weak banks from the beginning. In addition, it has asked the central bank to know about the steps taken to improve the condition of the banks.

The central bank has admitted that direct financial support has been provided to some banks and if the situation does not improve, a decision will be taken to merge them with other banks. If there is no progress after this, steps will be taken to close these banks in phases.

Zahid Hossain, former chief economist of the World Bank’s Dhaka office, told the press that Bangladesh Bank is providing financial assistance to weak banks through promissory notes, which are a promise to repay through a letter. The IMF does not find this method acceptable and it is a technical mission, the results of which can be discussed later. He believes that this will not completely disrupt the financial assistance process.

According to meeting sources, certain weak banks have made hazardous investments under the guise of paying back clients, and other banks have utilized the funds from the liquidity assistance for their own wages and benefits. The central bank is in an awkward situation as a result of these problems. The IMF has not yet received this information, though.