The Bangladesh Bank (BB) has formed a task force for banking sector reform, with six experts on the financial sector as members of the taskforce.
BB governor Ahsan H Mansur will serve as the coordinator of the taskforce.
Apart from taking different measures to reform the banking sector, the taskforce will also publish a white paper.
The central bank disclosed this in a notification published on Wednesday.
The six members of the taskforce are chief adviser's special envoy for international affairs Lutfey Siddiqi, former deputy governor Muhammad A Ali, BRAC Bank chairman Mehriar M Hasan, former lead economists at the Dhaka office of the World Bank Zahid Hussain, ZNRF University of Management Science vice chancellor M Zubaidur Rahman and Partner at Hoda Vasi Chowdhury & Co, Sabbir Ahmad.
According to the notification, this taskforce will mainly assess the existing financial situation, bad assets and major risks to maintain economic stability. Besides, the taskforce will conduct financial index review, assess actual conditions of the loans, actual price of assets, security deposit deficiency and will separate the bad assets of banks concerned.
The Bangladesh Bank said the task force will submit proposals related to limiting political and corporate influence on banking decisions, reform of bank ownership and development of the regulatory system under the process of strengthening good governance and risk management systems in the banking sector to achieve crisis time resiliency.
Besides, the taskforce will retrieve the money of the struggling banks, prepare regulations and related policies and will adopt separate policy measures for the weak banks.
The notification further said this taskforce will also amend different laws related to the financial sector, including the Bank Company Act and Bangladesh Bank Order and will propose for legislation, amendment and reform of laws regarding the asset management companies, bank acquisition and unification. It will also take measures to publish a white paper of the banking sector.
Following the ouster of the Awami League government, the interim government declared to form a bank commission for the reform of the financial sector. However, the government has formed a task force now.
The officials say the World Bank (WB) and Asian Development Bank (ADB) are providing loans for the banking sector reform. The money from the loan will also be spent on the modernisation of the central bank and enhancing its capability. At the same time, there has been an assurance of help from the International Monetary Fund (IMF) also.
Initially, the Bangladesh Bank started negotiating with the World Bank for a loan of USD 400 million. However, in the current context, the BB is negotiating for a USD 450-million-loan with the WB.
Meanwhile, the ADB has shown an interest to provide a loan of USD 1.3 billion for banking sector reform.