Message

I feel privileged to extend my greetings to the resilient Banking and Financial Institutions community of the country. Bangladesh made a strong recovery from the COVID-19 pandemic, but the post-pandemic recovery was disrupted in FY23 with rising inflation, financial sector vulnerabilities, external pressure, devaluation of Bangladesh currency, and global economic uncertainty. Still it shows remarkable resilience, achieving a modest GDP growth of 6.00% in the first half of 2023. The country’s manufacturing and service sectors with support from banking and financial institutions are playing an instrumental role to maintain this resilience.

I am thrilled to celebrate the successful launch of the Banking Almanac: Banks and Financial Institutions of Bangladesh, a testament to our community's enduring strength and contributions. From its humble beginnings in a fragile economy, Bangladesh's financial industry has provided stability and steady progress, even in the face of various crises over the past half-century. As of March 2023, the industry boasts a substantial lending portfolio of BDT 14,76,324 crores, comprising 61 banks and 35 financial institutions.

However, our journey to recovery from the COVID-19 crisis was met with unexpected challenges, as the repercussions of the Russian-Ukrainian conflict emerged. These challenges encompassed food and non-food price escalations, exchange rate depreciation pressures, foreign exchange reserve shortfalls, and energy shocks. Despite these hurdles, our banks and financial institutions, still recuperating from the previous crisis, now find themselves grappling with liquidity constraints and provision shortfalls.

In light of the evolving circumstances of this year, it is imperative for the financial industry to focus on liquidity management, non-performing loan (NPL) management, and expense control. Operating under the prudent guidance of the Bangladesh Bank, the industry must take swift and proactive measures to avert impending crises. Implementing specialized refinancing schemes targeting priority industries is one advisable step. Nevertheless, amid these uncertainties, we must not lose sight of the progress made in digitization, a trend that gained momentum in recent years, primarily due to the restrictions on physical meetings brought about by COVID-19. Exploring the opportunities presented by digitization is crucial to ensure sustainable growth and well-being.

It is the collective responsibility of our community to unite as one team, navigating the challenges of the global economic downturn, and steering ourselves towards sustainable growth and development.

Md. Golam Sarwar Bhuiyan
Chairman, BLFCA and Managing Director of IIDFC