Bangladesh Bank
Adopt market-driven US dollar exchange rate
Following the advice of the International Monetary Fund (IMF), the Bangladesh Bank has taken the initiative to set the exchange rate of the US dollar based on market principles. However, the Bangladesh Bank is not yet fully leaving the determination of the exchange rate of the US dollar to the market. It is still retaining some control over the exchange rate. Through a notification issued by the Bangladesh Bank, the new system for determining the exchange rate of the US dollar is being implemented starting this January. This new method for setting the exchange rate of the US dollar can be described as a advanced step towards the currently prevalent 'crawling peg' system. Under the crawling peg system, a reference rate would be set for the exchange rates of the US dollar and other foreign currencies. Scheduled banks and authorized institutions engaged in foreign exchange transactions would then set the exchange rate by adding or subtracting one taka from the rate set by the Bangladesh Bank. For example, if the exchange rate for one US dollar is set at 117 taka, the market would follow that base rate with minor adjustments.
Why the White Paper failed to make an impact
The interim government has set up several reform committees. One such committee, formed to review the economy left behind by the ‘autocrat’, recently published a white paper. During a press conference, the committee provided an explanation of the data and findings in the white paper. From the statements of the committee’s head, Debapriya Bhattacharya, it becomes clear that during the previous government's tenure, "crony capitalism" led to the creation of "corrupt systems", involving politicians, military and civilian bureaucrats, and the judiciary. The white paper claims that in the last 15 years, $234 billion was illegally siphoned out of Bangladesh through 28 different methods of corruption. However, the white paper did not attempt to identify the corrupt individuals, as it states its job is not to catch the thieves but to describe the methods of theft. Thus, the white paper only attempted to investigate the process of theft. According to Debapriya Bhattacharya, identifying the individuals or institutions involved in corruption would require appealing to the Anti-Corruption Commission (ACC) or the Intelligence Unit of the central bank.
BB withdraws policy interest rate hike initiative
BB withdraws policy interest rate hike initiative
Can lending to weak banks restore customer confidence?
Can lending to weak banks restore customer confidence?
Bank bailouts through money printing could ignite inflation
Bank bailouts through money printing could ignite inflation
Ignorance is the root to problem
Bangladesh Bank Officers Welfare Council Election Ignorance is the root to problem
Are borrowers or bankers more to blame for default loans?
According to the latest statistics from Bangladesh Bank, the total amount of default loans in the country's banking sector has reached 2,84,977 crore taka. This constitutes 16.93 per cent of the total loans disbursed by banks. In July, the amount of default loans was 2,11,391 crore taka. Therefore, in just three months, the amount of default loans in the banking sector has increased by 73,586 crore taka. During this period, the amount of default loans in state-owned banks has increased by 23,628 crore taka, while in private banks, the increase was 49,885 crore taka.
Financial crisis is not so critical
During a workshop titled "Inequality, Financial Crimes, and the Healing of Bangladesh's Economy," organized by Bonik Barta on November 11, 2024, at the Pan Pacific Sonargaon
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