Bangladesh Bank has recommended removing a controversial provision in the recently enacted Bank Resolution Act, arguing that the clause allowing former owners to reclaim merged troubled banks is not practical under current circumstances.
The issue was discussed during a meeting on Monday between Bangladesh Bank Governor Md Mostaqur Rahman and leaders of the Editors’ Council at the central bank headquarters in Dhaka.
According to the governor, Section 18(a) of the law, which provides for the return of ownership of merged banks under certain conditions, is “not maintainable” and should be deleted.
Explaining the central bank’s position, Rahman said the government has already injected nearly Tk 520 billion into five merged Islamic banks under Sammilita Islamic Bank. The merged institutions collectively hold about Tk 1.32 trillion in deposits, Tk 320 billion in performing loans, and Tk 1.64 trillion in non-performing loans (NPLs).
He said only Tk 200–300 billion of the defaulted loans may be recoverable, leaving a funding gap of at least Tk 650 billion. Given the financial condition of the banks, the governor questioned whether any former owners would be willing to reclaim ownership.
“Two months have passed since the law was enacted, but no one has shown any interest in taking back ownership,” he told the editors.
Led by its president and New Age Editor Nurul Kabir, the Editors’ Council raised concerns about the controversial provision and called for further scrutiny of the law. The editors also discussed a range of issues affecting the financial sector, including rising non-performing loans, governance challenges, depositors’ security, foreign-exchange market stability, inflation, investment, employment, and the proposed national budget.
After the meeting, Nurul Kabir said the governor outlined various reform initiatives being undertaken by the central bank and assured participants that necessary measures would be taken to address sectoral challenges.
The governor briefed the editors on ongoing reforms aimed at strengthening governance, improving oversight of weak banks, and enhancing financial stability.
He said administrative and management changes have already been implemented as part of the restructuring process for financially weak banks, adding that further progress is expected once upgrades to core banking systems are completed.
To tackle default loans, Rahman said amendments to the Money Loan Court Act are being prepared to speed up the resolution of loan recovery cases. He also confirmed that a Distressed Asset Management Company Act is being drafted to deal more effectively with unrecoverable assets.
The governor further informed the editors that Bangladesh Bank’s asset recovery efforts have resulted in the freezing of $25 million in laundered assets in the United Kingdom, which are expected to be repatriated to Bangladesh after completion of legal procedures.
Rahman stressed the importance of keeping the banking sector free from political influence and said the central bank’s reform programme is focused on professionalism, accountability, and good governance.
He also reiterated his opposition to political parties owning banks, saying public confidence in the banking system must be preserved.
On digital transformation, the governor said Bangladesh Bank is working to build an integrated financial ecosystem through expanded digital payments, AI-based credit assessment, agent banking services, and the implementation of the “One Citizen, One Identity, One Wallet” initiative.
He added that wider adoption of the Bangla QR payment platform could accelerate cashless transactions, improve security, and contribute to higher government revenue collection.
The meeting was attended by editors of several leading newspapers, including The Financial Express, Prothom Alo, Bonik Barta, Manabzamin, Samakal, Inqilab, and Agamir Somoy, along with senior Bangladesh Bank officials.
