Despite various facilities extended to borrowers, default loans in the banking sector continue to rise at an alarming rate.The amount of default loans in the country’s banking sector again crossed Tk 6.0 trillion at the end of June.Earlier, default loans had crossed the Tk 6.0 trillion mark for the first time in September last year.According to Bangladesh Bank data, the amount of classified or default loans in the banking sector stood at Tk 6.07 trillion at the end of June 2026.This accounted for 32.78 per cent of the banks’ total outstanding loans.

At the end of March 2026, default loans stood at Tk 5.89 trillion, accounting for 32.26 per cent of total outstanding loans.

This means default loans increased by Tk 178.51 billion in the three months from March to June.

Meanwhile, default loans in the banking sector increased by Tk 493.38 billion during the first six months of the current year.

At the beginning of the year, default loans stood at Tk 5.57 trillion.

Over the six-month period, the amount rose to Tk 6.07 trillion.

Although various facilities, including loan rescheduling and restructuring, have been provided to reduce default loans in the banking sector, they have failed to produce the desired impact.

Instead, weaknesses in loan recovery and fresh loan defaults have pushed up the overall volume of classified loans.

With nearly one-third of total outstanding loans turning bad by the end of June, fresh concerns have emerged over the quality of bank assets.

Continued growth in default loans could put further pressure on banks’ earnings, capital and overall financial stability.

Adani Power has reduced electricity dispatch from its 1,600MW Godda power plant to Bangladesh during off-peak daytime hours due to disruptions in coal transportation by rail, the company said today (2 September).

In a statement issued through 5W Communications, Adani Power's public relations firm in Bangladesh, the company said severe railway congestion and multiple loading restrictions across the transportation network had affected the movement of coal-carrying railway rakes to the Godda plant.

"As a result, the plant is receiving lower-than-normal coal supplies and is temporarily forced to optimise production," Adani Power said.

Power Grid Bangladesh data showed the impact of the reduced dispatch particularly during the daytime today.

Adani supplied 828MW at 8am against a forecast of 1,436MW. Supply remained around 920MW for much of the day before rising to 1,061MW at 5pm.

At 10am, the plant supplied 923MW, followed by 924MW at 11am, 913MW at noon, 921MW at 1pm, 920MW at 2pm and 943MW at 3pm. Supply stood at 924MW at 4pm, according to the latest available data.

The company said it had deliberately reduced daytime dispatch to preserve sufficient generation capacity for the evening peak.

"Consequently, the plant has moderated power dispatch during off-peak daytime hours to ensure adequate availability during the evening peak demand period," it said.

Yesterday (1 September),the company supplied 827MW at 5pm and 861MW at 6pm against a demand of 1,436MW. Supply rose to 1,314MW at 7pm, 1,315MW at 7:30pm and 1,312MW at 8pm.

Adani Power said it had kept the Bangladesh Power Development Board informed of the situation and was working with Indian Railways to restore normal availability of coal-carrying rakes as soon as possible.

"We expect the situation to normalise shortly," the company said, adding that it was taking all possible measures to maximise coal deliveries and minimise the impact on power supply.

The reduced dispatch comes as Bangladesh is already facing a significant electricity shortfall amid a gas supply crunch affecting power plants.

The lower output from the Adani plant is likely to add further pressure to the country's ongoing load-shedding situation.

Bangladesh Bank (BB) has launched a Foreign Exchange Market (FXM) Module to automate foreign exchange intervention, interbank transactions and reporting-related activities, aiming to enhance efficiency, transparency and reliability in the country’s foreign exchange market.

BB Governor Md Mostaqur Rahman formally inaugurated the FXM system at the central bank’s Foreign Currency Management (FCM) department on Tuesday, said a press release.

Deputy Governor Dr Md Kabir Ahmed and Director of Foreign Reserve and Treasury Management Department-1 A.K.M. Ramizul Islam, among other officials concerned, attended the inaugural programme.

The FXM module has been developed by Bangladesh Bank’s own officials to automate activities that were previously carried out manually.

Bangladesh Bank periodically conducts foreign exchange interventions to maintain stability in the domestic foreign exchange market.

At the same time, banks undertake interbank foreign exchange transactions, including spot, forward and swap deals.

Banks also collect information on customer-level foreign exchange transactions, including imports, exports and remittances, which is used to prepare reference exchange rates published twice daily on Bangladesh Bank’s website.

According to the central bank, automation through the FXM module will enable foreign exchange transactions to be conducted on a real-time basis and facilitate the preparation of accurate reference rates.

It will also improve the accuracy, transparency and reliability of related information.

The system is expected to enhance commercial banks’ capacity to take timely decisions and improve the efficiency of their operations, thereby facilitating liquidity and risk management.

The real-time availability of information will also strengthen Bangladesh Bank’s market surveillance and help the central bank take timely and realistic decisions based on updated market data.

Bangladesh Bank has already issued a circular to the concerned banks along with Operational Guidelines detailing the use and procedures of the FXM system.

The central bank expects the automation to enhance efficiency, transparency and accountability in the country’s foreign exchange market operations while strengthening market management and supporting more effective policy decisions.

The Trump administration won backing from all G20 financial leaders except China's on Tuesday to act against "non-market" policies and distortions that cause over-reliance on exports and hinder growth elsewhere.The finance ministers' meeting clearly focused on China, while Washington used a parallel G20 gathering of industry titans and commerce ministers to make the case for a hands-off approach to AI regulation.
US Treasury Secretary Scott Bessent said he had been proven right when he warned other trading partners last year that tougher US tariffs would lead to an influx of Chinese goods diverted to their markets."We believe that non-market-based economies pushing out a never-ending stream of cheap exports is not sustainable," he told a news conference."I think that the fact that 19 countries did want to address this shows the sheer the enormity of the problem."A G20 chair's statement to conclude the meeting said the participants, except China's, agreed that countries should eliminate "non-market policies" that exacerbate imbalances.

"In particular, countries with excessive and persistent external surpluses should remove distortions that constrain domestic consumption and that result in an over-reliance on exports for growth," the statement said.

The two-day meeting of finance chiefs - which saw differences in tone between the US hosts and some European participants - came amid a global bond market selloff on worries over growing debt levels and inflation pressures.

European countries and Canada expressed dismay that Russia, invited by the forum's US hosts, attended for the first time since it invaded Ukraine in 2022.

CHINA'S MASSIVE EXPORT PUSH

China's massive export push has pressured economies across the globe, especially as the United States has imposed high tariffs on Chinese goods and outright bans on some products, such as Chinese vehicles.

With chronically weak demand, China has doubled down on exports of electric vehicles, semiconductors and other goods, and its total exports rose 23.9 percent in July year-on-year, prompting growing calls in Europe for tougher curbs on Chinese imports.

G20 member China has shown little interest in longstanding calls for it to reduce industrial subsidies and rebalance its economy, while its yuan currency remains significantly undervalued by most measures.

China's goods trade surplus with the European Union hit €360.6 billion last year, a 15 percent increase on 2024, and has expanded further this year.

European Economy Commissioner Valdis Dombrovskis said in a briefing that China is a major source of economic imbalances, but said the US and Europe both also had roles to play in evening things out.

In more direct comments, German Finance Minister Lars Klingbeil said the US- and Israeli-led Iran war, together with ongoing US tariff disputes, were also major causes of uncertainty holding back the global economy.

"Uncertainty is poison for economic growth," he said. "The tariff conflicts being pursued by the US, such as the current dispute with Canada, destroy trust."

Britain said it would maintain a pragmatic trade relationship with China, while navigating what it said was the sensitive issue of trying to reduce imbalances.

Canada, which has forged closer economic ties to China since the start of the year, was engaging with China no differently than other G7 countries and with "clear guardrails," its finance minister Francois-Philippe Champagne said.

International Monetary Fund Managing Director Kristalina Georgieva told Reuters she believed China recognized it needed to take action, but they were calling more for coordinated action with others, such as the United States reducing its growing fiscal deficits, which contribute to excessive import demand.
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Beijing has also leveraged its dominance in processing of critical minerals by placing export restrictions on rare earths in April 2025, a response to US President Donald Trump's tariffs that has also affected non-US companies.

Japanese Finance Minister Satsuki Katayama, speaking late on Monday, said she had told her G20 counterparts that arbitrary export restrictions on critical minerals were harming the global economy. The issue was included in the G20 chair's statement.

"We urge countries to avoid unnecessary export restrictions to ensure global supply chains continue to function normally," it said.

A selloff in global bond markets deepened on Tuesday, with Japan's 10-year bond yield hitting 3 percent for the first time since 1996 - the latest manifestation of investor concern about energy-driven inflation, potential monetary tightening and worsening fiscal conditions.

Treasury officials said Bessent had called for sound monetary policy to anchor inflation expectations and avoid excessive currency volatility during his meeting on Sunday with Bank of Japan Governor Kazuo Ueda.

"I have information that the market doesn't have, and it's my belief that the Japanese government and the BOJ will do the things that will lead to a stronger yen," Bessent told CNBC in an interview.

The remarks, which underline Bessent's recent calls for the BOJ to raise interest rates, were seen by the markets as aimed at bolstering the case for a rate hike at the BOJ's policy meeting on September 17-18.

The government has increased the maximum retail price of bottled soybean oil by Tk 5 to Tk 204 a litre, citing higher international prices and import costs.

The new price will take effect tomorrow, following a decision taken at a meeting between the Ministry of Commerce and edible oil traders today.“Bottled soybean oil has been increased from Tk 199 to Tk 204 a litre,” Commerce Secretary Md Ataur Rahman Khan told reporters after the meeting.

However, the prices of loose soybean oil and palm oil have been kept unchanged, he said.

The decision came after edible oil refiners and importers sought a price adjustment.

The Bangladesh Vegetable Oil Refiners’ and Vanaspati Manufacturers’ Association had earlier said the cost of imported edible oil had risen substantially following an increase in international prices.

The association claimed that the cost of imported edible oil had reached Tk 217 a litre, while refiners had been selling bottled soybean oil at Tk 199, resulting in a loss of around Tk 18 per litre over the past three months.

The Bangladesh Trade and Tariff Commission had recommended a Tk 10-per-litre increase, while traders reportedly sought a higher increase at today’s meeting.

The government, however, opted for a smaller adjustment after considering consumer interests, according to the commerce secretary.

“The importers had applied for a price adjustment due to the rise in edible oil prices in the international market and higher transportation costs. After reviewing the market situation, the government decided to make a limited adjustment,” Ataur said.

He said there was currently an adequate supply of edible oil in the domestic market and no shortage.

“The government is regularly monitoring the situation to keep the market stable,” he added.

Asked whether edible oil prices would be raised again before Ramadan, the commerce secretary said it would depend on international prices, import costs and the overall supply situation at that time.

Meanwhile, in a press release, the refiners said they accepted the Tk 5 increase, as they had received assurances that the price would be raised further soon.

Amid the energy crisis that has been dragging on for more than a month, top business leaders have recommended bringing idle power plants run by coal, furnace oil and diesel back into operation as a short-term measure.

They say this would reduce some of the pressure on gas supplies used for electricity generation, allowing more gas to be diverted to manufacturing units.

The ownership of coal, furnace oil and diesel-fired power plants in Bangladesh is split between the government and private independent power producers. Private companies hold a large share of oil-based generation, while coal-fired capacity is driven by large public-private or state ventures.

The proposal by the business leaders is aimed at firefighting the immediate energy crisis triggered by the US-Israeli war on Iran, which has disrupted shipping through the Strait of Hormuz and severely affected liquefied natural gas (LNG) deliveries from the Middle East. Alternatively, refined heavy fuels and coal are available in regional markets, including Singapore, Malaysia and Indonesia.
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Businesses are going through a turbulent period as energy shortages, difficulties in accessing finance and growing uncertainty weigh on factory production and make firms cautious about new investment decisions.
Md Fazlul Hoque, Administrator to FBCCI

At a discussion at The Daily Star Centre in Dhaka yesterday, the business leaders also made recommendations for the medium and long-term energy plan.

“Many factories, especially apparel units, are now running at only 30 percent to 40 percent capacity because of frequent power outages,” Fazlee Shamim Ehsan, president of the Bangladesh Employers’ Federation, said at the discussion.

Frequent load-shedding is affecting the dyeing sections of garment factories, making it difficult for apparel manufacturers to achieve the exact colour of fabrics, as the dyeing process requires a continued flow of adequate gas pressure, he told the programme on current challenges facing the industrial sector and the way forward.

Shamim, who is also the executive president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said the actual gas pressure was allocated at 15 PSI, but factories are currently getting as little as 1 PSI, which is inadequate to run the dyeing sections.

He said nearly 1,200 garment exporters in Fatullah area of Narayanganj industrial belt are facing the same problem.
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If I know I will miss a deadline by 20 days, I can plan for it. But I do not know how long an energy disruption will last, it is worse.
Fazlee Shamim Ehsan, President of Bangladesh Employers’ Federation

If the government can supply gas even at 7 to 8 PSI, it would be acceptable to businesses as they could run their factories and ship goods according to their commitments to international trading partners, he said.

For dyeing factories, the problem is particularly serious because the process depends on steady heat and steam. Frequent interruptions make it difficult to maintain production schedules and ensure the required colour and quality of fabrics, said the BKMEA executive president.

According to him, until now, factory owners have continued operating despite lower gas pressure and frequent load-shedding, hoping energy supplies will improve soon. However, it is becoming difficult for businesses to know how long they can continue operating under such conditions.

“If I know I will miss a deadline by 20 days, I can plan for it. But when I do not know how long the disruption will last, that is much worse,” Shamim said.

He believes the immediate response should focus on restoring energy supplies rather than waiting for a permanent solution. He also called for a clear short, medium and long-term energy plan so businesses know what to expect.

Fazlul Hoque, administrator of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said businesses are now going through a turbulent period as energy shortages, difficulties in accessing finance and growing uncertainty weigh on production and investment.

He said the current crisis is in some ways worse than the Covid-19 period because the pandemic affected countries at the same time, whereas the present situation is uneven, with some countries doing well while others are struggling.

During the pandemic, Bangladesh’s competitors were also facing widespread similar disruptions, meaning businesses in major competing countries were also dealing with similar difficulties, Fazlul said.

“But the current situation is different, with some countries operating normally or doing well while we are struggling with energy shortages, finance and other constraints.”

For businesses, he said, the problem is no longer confined to one sector. Gas and power shortages are disrupting factories, banks have become more cautious about lending and trade finance, while uncertainty is making entrepreneurs reluctant to commit fresh capital.

“The result is a slowdown in investment at a time when the economy needs new money and new activity,” said Fazlul.

The FBCCI administrator said the country needs to pay greater attention to investment in areas such as IT and AI-related sectors over the next two to three years and diversify where capital is being deployed.

Even if such investments do not immediately create large numbers of jobs, they would bring money and foreign currency into the country and help keep economic activity moving, he said.

Instead of waiting for large investments to return, Fazlul said Bangladesh should encourage a broader flow of capital, including foreign direct investment, so that money continues to circulate through the economy.

“But restoring production is an immediate concern.”

The immediate challenge, Fazlul said, is to take the initiative to operate furnace oil and coal-based power plants to mitigate the ongoing crisis. One option is to bring idle or underused power plants back into operation using alternative fuels such as furnace oil.

He said Bangladesh’s export economy has grown substantially over the years, creating jobs and building industrial capacity. But repeated shocks have also eaten into businesses’ reserves, leaving many companies with little room to absorb another prolonged disruption.

“The energy crisis has also exposed the limits of the banking sector’s ability to support struggling businesses.”

Fazlul said commercial banks have become overcautious and are demanding a lot of documents for loan approval. At the same time, some banks are not giving loans easily because of a trust deficit between bank management and exporters.

“Banks that once helped distressed factories recover are now dealing with problems of their own. As a result, businesses that need working capital or support to restart operations are finding it harder to get help.”

He argued that the biggest problem is no longer simply the high interest rates. For most businesses, the FBCCI administrator said, access to finance matters more than the rate itself.

“Banks have become more cautious and transactions that once took minutes can now take days as lenders scrutinise risks more closely.”

He said that caution is understandable given the condition of the banking sector, but prolonged delays can create another problem for businesses, particularly exporters who need timely trade finance.

For companies already facing production losses because of inadequate gas and electricity, delays in obtaining working capital can further restrict their ability to operate.

This combination of weak energy supplies, cautious banks and uncertainty is also making businesses more reluctant to invest, he added.

Bangladesh Bank (BB) on Wednesday issued a consolidated circular updating regulations governing foreign exchange transactions related to loans, overdrafts, guarantees and external borrowings.

The Foreign Exchange Policy Department-1 (FEPD-1) issued the circular, which consolidates the instructions contained in the previous FE Circular No. 34 issued on September 2, 2025, along with subsequent circulars issued thereafter.

With the issuance of the new circular, all previous instructions on the subject have been repealed, except for the reporting instructions contained in the Guidelines for Foreign Exchange Transactions (GFET), Volume-2. The new instructions will remain valid for one year from the date of issuance.

The circular covers lending activities, loans and overdrafts, trading and commercial loans, foreign-owned or controlled companies, guarantees, repayment guarantees, foreign borrowing and related foreign exchange transactions.

Under the updated rules, banks and finance companies may provide admissible Taka financing against overseas bank guarantees (BGs) or standby letters of credit (SBLCs) to resident companies, regardless of their ownership or controlling status, subject to applicable credit norms, prudential requirements and specified conditions.

Such overseas BGs or SBLCs must be unconditional, irrevocable and payable on first demand, and must be issued by a non-resident bank or institution having an acceptable international credit rating. Banks and finance companies must also ensure the legal enforceability of the guarantees and assess borrowers' financial soundness and repayment capacity.

The circular also provides general authorization for banks to extend Taka working capital loans to foreign-owned or foreign-controlled industrial and trading firms operating in Bangladesh, subject to prevailing credit norms and normal banker-customer relationships. Resident companies may also provide interest-free Taka working capital loans to such foreign-owned or controlled companies under the new consolidated framework.

Foreign-owned or controlled companies engaged in manufacturing or services for three years or longer may obtain Taka term loans from the domestic market for capacity expansion or balancing, modernisation, rehabilitation and expansion (BMRE), provided applicable credit norms and prudential parameters are followed. Their total debt, however, must not exceed a 60:40 debt-equity ratio.

The central bank has also retained provisions allowing authorized dealer (AD) banks to issue certain guarantees on behalf of Bangladeshi exporters in favour of overseas buyers without prior approval, subject to banking norms and conditions.

For foreign borrowing, proposals by private-sector industrial enterprises require prior authorization from the Invest Bangladesh Authority. Short-term credit facilities of up to one year from foreign suppliers or buyers remain subject to Bangladesh Bank's guidelines governing current commercial transactions.

The circular says repayment of approved foreign loans may be remitted by AD banks without prior reference to Bangladesh Bank, subject to specified conditions, including submission of relevant loan agreements, repayment schedules and, in the case of supplier's credit, bills of entry confirming the arrival of imported capital goods.

Borrowing abroad by public-sector entities will require government approval, while commercial or non-concessional borrowing will additionally require specific approval from the Standing Committee on Non-Concessional Loan (SCNCL).

The circular also requires AD banks to submit consolidated quarterly statements of foreign loans approved by the Invest Bangladesh Authority or Bangladesh Bank, including information on the utilization of each loan, within 15 days of the end of each quarter.

For enterprises operating in specialized zones, the circular categorizes them as Type A (100 percent foreign-owned), Type B (joint ventures between foreign investors and Bangladeshi entrepreneurs) and Type C (100 percent Bangladeshi-owned). It provides separate provisions for foreign currency and Taka financing for these enterprises.

The circular also allows Type A enterprises in specialized zones to obtain short-term foreign currency loans from overseas banks and financial institutions for specified purposes, including imports of capital machinery and raw materials, payment of interest and service charges, loan repayment and meeting local expenses.

The new consolidated circular was issued under the authority vested in Bangladesh Bank by Section 20(3) of the Foreign Exchange Regulation Act, 1947.

Stocks slumped in Asian trading on Wednesday as a bond market-induced selloff on global markets spilled over into the region, after renewed attacks by the US on Iran pushed oil prices higher.

MSCI's broadest index of Asia-Pacific shares outside Japan tumbled 1.5 per cent as South Korea's KOSPI dropped more than 3 per cent, while the Nikkei 225 was down 2.6 per cent. S&P 500 e-mini futures EScv1 were down 0.1 per cent.

Brent crude futures extended gains into a second day as trading resumed in Asia, rising 1.3 per cent to $95.91 a barrel after the US launched a barrage of airstrikes on Iran on Tuesday, which earlier pushed oil prices to a five-week high.

"The threat of further disruptions to the Strait of Hormuz has brought about renewed anxiety over inflation, driving a selloff in stocks across most major markets and a rout in global bond markets," Westpac analysts wrote.

The yield on the US 10-year Treasury bond hit an intraday high of 4.8122 per cent, its highest level in almost three years, while the yield on the 5-year Japanese government bond rose to 2.295 per cent, its highest level on record.

"September kicked off on a shaky note as developed market government bonds continued to sell off," DBS analysts wrote.

"Brace for a volatile month ahead as high yields cause angst across the asset classes," they added. "If the bond rout does not get stemmed, policymakers would probably have to resort to more aggressive measures to cap yields."

The kiwi dollar was down 0.6 per cent at $0.5855 after the Reserve Bank of New Zealand hiked interest rates by 25 basis points to 2.75 per cent, as expected by markets, though dovish language in the central bank's statement weighed on the currency.

The US dollar index =USD, which measures the greenback's strength against a basket of six currencies, was up 0.1 per cent at 99.79, its highest since Aug 17.

Overnight on Wall Street, the S&P 500 slipped 0.7 per cent and the Nasdaq Composite fell 1 per cent as a surge in government bond yields weighed on equities.

The declines came as data from the Institute for Supply Management released on Tuesday showed US manufacturing activity moderated in August amid a slowdown in new orders, but remained in expansionary territory.

Traders believe that the Federal Reserve is likely to lift interest rates at its next meeting in two weeks, though a hike is not certain.

Fed funds futures are pricing an implied 67 per cent probability of a 25-basis-point increase to benchmark borrowing costs at the US central bank's two-day meeting ending on September 16, compared with a 39.6 per cent chance a week ago, according to the CME Group's FedWatch tool.

Gold was down 0.8 per cent at $4,295.70 an ounce, while bitcoin slipped 0.6 per cent to $76,979.55 and ether was 0.9 per cent lower at $2,397.78.

The Bangladesh Bank is set to introduce a Tk500 crore financing programme, named UDYOG, for young entrepreneurs at the upazila level across the country.

The central bank's board recently approved the programme, which is likely to be announced today.

Under the proposed structure, funds may be collected from the corporate social responsibility (CSR) funds of scheduled banks to establish a separate, regulated grant account or special fund. The funds in this account will be used as performance-linked conditional grants for selected entrepreneurs.

Earlier, on 11 August, Bangladesh Bank Governor Md Mostaqur Rahman held a meeting with the chairman of the Association of Bankers, Bangladesh (ABB), managing directors and chief executive officers of 12 scheduled banks, and relevant officials of the central bank.

The meeting discussed in detail the selection of entrepreneurs under the programme and the establishment of an integrated financing mechanism combining bank loans with grants from the CSR funds of scheduled banks.

Particular importance was given to using unutilised institutional CSR funds of scheduled banks to finance the grant component of the programme.

As the programme is directly aligned with the objectives of entrepreneurship development, employment generation, and financial inclusion, using a portion of the unutilised CSR funds for the initiative would ensure more effective, targeted and outcome-oriented use of CSR resources, according to the proposed plan.

Under the programme, applications will be invited from young entrepreneurs across different upazilas, followed by screening, shortlisting, assessment of business potential and selection through credit appraisal.

A lead bank in each upazila will coordinate the programme. Selected entrepreneurs will be provided with bank loans based on their actual business needs and credit appraisal, under the applicable sectors of existing refinancing facilities available through Bangladesh Bank's SME and Special Programmes Department, according to Bangladesh Bank sources.

An important feature of the programme is an integrated financing mechanism combining loans and conditional grants.

A portion of the grant will be provided conditionally at the initial stage to meet entrepreneurs' immediate business needs, while the remaining portion will be kept in a separate grant account.

The remaining grant will be activated at a later stage based on the entrepreneur's loan repayment performance and fulfilment of predetermined assessment criteria.

According to the proposed plan, this mechanism will not only provide initial support to entrepreneurs but also encourage them to build sustainable businesses and improve their loan repayment capacity.

How the programme will be implemented

For effective implementation of the programme at remote and upazila levels, money will be spent for identifying and selecting promising young entrepreneurs, publicity and promotional activities, receiving and screening applications, organising meetings, workshops and entrepreneur gatherings at upazila and regional levels, evaluating business ideas, capacity building, meetings with relevant stakeholders and other necessary activities.

For the smooth and effective implementation of the programme, it has been decided that expenses related to entrepreneur searches and identification, meetings, programmes, publicity and promotional activities, and other approved implementation costs will be met from Bangladesh Bank's CSR Fund, according to the proposed plan.

The nature and limits of expenditure, approval procedures, accounting and audit-related matters will be determined in accordance with Bangladesh Bank's existing financial rules and applicable guidelines.

The proposed plan document further noted that the role of young people was extremely important in Bangladesh's economic development, employment generation and promotion of innovative initiatives.

Many promising young men and women in remote areas and at the upazila level have viable business ideas but, due to a lack of initial capital, business advisory support, institutional networks and financing, are unable to turn those ideas into sustainable enterprises.

Against this backdrop, the Bangladesh Bank has taken the initiative to implement an upazila-based young entrepreneur identification and financing programme under its supervision, the document said.

As I walked through the streets of Ho Chi Minh City last week, my second trip there within a month, I couldn’t help but wish Dhaka could resemble it. It was a delightful experience to walk on cleaner pavements without constant uneven impediments and hawkers. I neither had to encounter reckless battery-run rickshaws nor put up with beggars nudging at my car windows. I never had to worry about security while taking a stroll on the streets of Ho Chi Minh City late at night. I could smell the aroma of world-famous Vietnamese coffee as I passed cafes that are almost omnipresent. I took “Grab” cars for rides, with comfortable, spacious and clean vehicles that reminded me of the run-down Uber cars in Dhaka. Both are old cities, yet Ho Chi Minh City is so much more liveable because of these small things.

Vietnam is rapidly progressing to a developed economy. Singapore did this decades ago. Vietnam is on the same path, with much bigger geographical and demographic advantages.

Vietnam is having a spectacular growth phase. In its latest assessment report, Standard Chartered has raised its forecast for Vietnam’s GDP growth in 2026 to 9.5 percent and 11 percent for 2027. It has also lowered its inflation forecasts to 4.4 percent for 2026 and 3.3 percent for 2027. Vietnam’s foreign direct investment was a staggering $38 billion during the first seven months of 2026. These are enviable economic indicators for any country. The government is encouraging banks to support its target of achieving double-digit GDP growth. The State Bank of Vietnam (SBV) has recently allowed banks to exclude public sector project loans from their overall credit limits and single borrower limits.

Yet economic indicators alone do not tell the full story until one experiences Vietnam first-hand. I could feel the vibe of a country collectively focused on its growth journey. I could see large infrastructure projects everywhere, even when I travelled outside Ho Chi Minh City. I saw people rushing to their destinations in cars and motorbikes. I found shopping malls with world-class brands full of visitors, locals and tourists. I visited grocery stores as locals stocked up their shopping carts with wholesome food and vegetables.

Vietnam has also become an attractive tourist destination. Some places reminded me of Kolkata, with colonial-era buildings and museums full of rich history. The food is served artistically in Michelin-starred restaurants, though my strict “halal only” cuisine policy left me with limited choices of vegetarian dishes, full of local herbs enriched with heavenly aroma. Most people in Vietnam, even at professional levels, do not speak or understand English. That is not an impediment to its growth journey, as it did not stop China or Korea. Vietnamese professionals have an insatiable hunger to learn best practices from global experts and implement them, especially in banking. Many expatriates are now working in Vietnamese banks and companies, sharing their experience and training local talent, who are very hard-working, bright and promising.

Vietnam is rapidly progressing from a developing to a developed economy. Singapore did this decades ago, and now Vietnam is on the same path, with much bigger geographical and demographic advantages. With a deep-rooted supply chain powered by SMEs and households, global tech giants such as Samsung, LG and Foxconn have chosen Vietnam as major manufacturing bases. As companies continue to hedge their China dependence and leverage their connectivity with other markets, Vietnam is leaping forward by building top-class infrastructure, delivering good governance and achieving world-class productivity in manufacturing and electronics.

There is a lot to learn from the Vietnam story as it unfolds rapidly in front of our eyes, and not too far from us.

Fuel shortages, production and supply-chain disruptions, difficulties opening letters of credit (LCs) and unchecked middlemen, rather than the newly approved pay scale, could drive up prices of essential commodities, businesses said today (1 September).

They said prices of sugar, edible oil, pulses, flour and refined flour should remain stable if supply is adequate and aligned with demand.

The observations came at a views-exchange meeting between the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) and businesses involved in importing, wholesaling and retailing essential commodities at the federation's Motijheel office in Dhaka. FBCCI Administrator Md Fazlul Hoque chaired the meeting.

The discussion came amid concerns that the new pay scale could push up prices of essential goods.

Wholesalers and retailers said maintaining adequate supplies would be key to price stability and called for uninterrupted fuel supplies to production-oriented factories.

Mill owners said gas and electricity shortages were already disrupting production, while difficulties opening LCs were creating additional challenges for essential commodity importers.

Gholam Mawla, general secretary of the Moulvibazar Business Association, said the market could not remain stable unless imports and mill production continued without disruption. He called for urgent measures to resolve the fuel crisis and LC-related complications.

Pay bonanza for govt staff amid inflation, energy crisis
Mill owners' representatives also said domestic sugar prices had remained unchanged despite higher international raw sugar prices.

Traders called for stronger oversight across the supply chain to prevent unnecessary price increases.

Md Zakir Hossain, general secretary of the Bangladesh Supermarket Owners Association, suggested reducing the number of times products change hands before reaching consumers to lower supply-chain costs.

Business leaders also called for stronger price monitoring at wholesale and retail markets and mill gates, as well as law enforcement intervention where necessary to prevent harassment along the supply chain.

Md Abul Kalam Azad, organising secretary of the Consumers Association of Bangladesh, urged the government and businesses to ensure uninterrupted supplies and curb the dominance of middlemen.

The meeting also discussed government measures to keep essential commodities affordable.

A Trading Corporation of Bangladesh (TCB) representative said the state-run agency was selling essential commodities at subsidised prices to nearly one crore families through its family card programme. A Directorate General of Food representative said subsidised rice was being distributed to low-income people under the Food-Friendly Programme.

Businesses, however, urged TCB to strengthen its capacity to import directly or source from alternative suppliers rather than relying mainly on domestic companies.

In his closing remarks, Fazlul Hoque said the recommendations would be documented and placed before policymakers. He urged businesses to cooperate to ensure the new pay scale does not lead to unjustified price increases.

The Dhaka Stock Exchange (DSE) plans to introduce financial derivatives by January 2028 after the Bangladesh Securities and Exchange Commission (BSEC) approved its action plan for launching the new asset class.

According to a BSEC press release issued after a commission meeting on today (1 September), the bourse will initially introduce index futures, with contracts based on the blue-chip DS30 index expected to be the first products.

The approved roadmap covers regulatory reforms, trading and other infrastructure, clearing and settlement systems, and risk management measures. BSEC will also monitor the DSE's progress in implementing the plan.

A senior DSE official said the bourse also plans to introduce exchange-traded fund-type instruments under the new segment. Unlike conventional share trading, derivatives allow investors to trade contracts linked to the future price movements of underlying assets.

The DSE will procure a new multi-asset trading engine by 2028 to handle derivatives and multiple clearing systems. Its existing Nasdaq-provided trading engine, which mainly supports equity trading, is scheduled to expire in 2027.

In preparation, the DSE will conduct feasibility studies, workshops and seminars for market participants.

The introduction of derivatives is expected to deepen the capital market and give local and foreign investors additional tools for hedging and risk management.

The Bangladesh Securities and Exchange Commission (BSEC) has relaxed a stringent rule regarding the transfer of shares held by sponsors and directors of "Z-category" companies, shifting administrative authority directly to stock exchanges.

In a commission meeting held today (1 September), the regulator decided that its prior approval will no longer be required for specific equity security transactions involving these troubled firms.

According to the amendment, the commission has specifically waived the need for direct BSEC permission in cases involving the confiscation of shares due to loan defaults and the transmission of shares following a shareholder's death.

This decision follows a thorough review of a previous directive issued on 20 May 2024, which had imposed a blanket restriction on all forms of share transactions – whether on the trading platform or off-market – for sponsors and directors of non-financial companies listed in the junk category.

Under the revised framework, the country's bourses will now be empowered to facilitate and execute such transfers in accordance with existing listing regulations.

Market analysts believe this shift toward deregulation will eliminate unnecessary bureaucratic hurdles and expedite legal processes, particularly for lenders seeking to recover defaulted dues or legal heirs managing inheritance matters.

The 2024 directive was originally implemented to prevent sponsors and directors of poorly performing or non-compliant companies from dumping their holdings without regulatory oversight. While monitoring remains intact, the commission aims to streamline operations by delegating specific responsibilities directly to the stock exchanges.

The move marks another step in the commission's broader push to simplify market operations and reduce excessive intervention, according to officials.

The securities regulator has given its permission to Dominage Steel Building Systems to transfer 30.78 million ordinary shares to Akij Resources and two individuals, resulting in a significant reshuffling of the company's ownership.

The Bangladesh Securities and Exchange Commission (BSEC) gave its approval on August 27, paving the way for the proposed transfer, according to a regulatory filing on Sunday.

As per a negotiated deal, the shares will be transferred at a price of Tk 13 each, said BSEC spokesperson Md. Abul Kalam.

So, Akij Resources and two individuals will have to pay more than Tk 400 million to receive the shares of Dominage Steel.

The individuals who purchased the shares are Sheikh Jasim Uddin and Faria Hossain.

The company said the transfer would be executed outside the regular trading system as a matched transaction. A matched transaction is generally used for a predetermined block of shares between identified parties, rather than through buying and selling orders on the stock exchange.

Dominage Steel said it would inform the market once the share transfer is completed.

Earlier in April this year, Dominage Steel's board decided to sell ownership stakes at a negotiated price through an off-market transaction.

Upon completion of the regulatory process, a new board of directors will take over the management and operations of the company.

No company of the Akij Group has yet been listed on the stock exchanges. So, it will enter the secondary market through the acquisition of Dominage Steel.

Akij Resources holds a significant presence in the steel and construction sectors through its subsidiaries. Officially established in April 2020, it builds on the heritage of the Akij Group, one of Bangladesh's largest conglomerates.

Meanwhile, the stock of the listed steel manufacturer has climbed remarkably over the last year. It surged 401 per cent to Tk 86.2 between September 1 last year and July 28 this year. Later, the stock declined and closed at 63.60 on Monday, gaining 0.32 per cent over the previous day.

The market price of the shares to be transferred stands at Tk 1.95 billion.

As per the securities rules, the sponsor-directors of a listed company are required to jointly hold at least 30 per cent of shares. Hence, the shares will remain locked as sponsor holding.

The country's premier bourse returned to positive territory today (1 September), providing a much-needed respite to the capital market after a prolonged downturn.

Driven by aggressive bargain hunting and renewed optimism over structural reforms, the benchmark DSEX index of the Dhaka Stock Exchange (DSE) surged by 39 points, or 0.70%, to settle at 5,637.

Market participation saw a healthy spike as total turnover on the DSE jumped by 25% to reach Tk596 crore, compared to the previous session. The day's trading was characterised by overwhelming bullish dominance, with the market breadth showing 300 issues advancing, 50 declining, and 38 remaining unchanged.

According to EBL Securities' daily market review, the ailing capital market got some relief as investors viewed prevailing prices as attractive entry points. Bargain hunters stepped in to accumulate beaten-down stocks, particularly in sectors that had undergone sharp corrections.

The market opened on an optimistic note, supported by favourable remarks from regulators on the capital market's long-term development. Although selling pressure emerged intermittently after mid-session, it was not enough to wipe out the morning gains, with buyers remaining in control until the close, it added.

Sheltech Brokerage Limited observed that the rally was driven mainly by renewed buying interest and optimism over the Bangladesh Securities and Exchange Commission's (BSEC) recent market-development initiatives. The benchmark index climbed to an intraday high of 5,674.16 points, but late-session profit-taking erased much of the gain.

The index eventually closed near its intraday low of 5,624 points as some investors opted to book quick profits amid persistent domestic challenges, it also said.

On the sectoral front, the textile sector dominated the floor, accounting for 27.9% of the total turnover, followed by the banking and pharmaceutical sectors at 12.2% and 12.0%, respectively.

Nearly all sectors posted gains, led by mutual funds, which rose 4.2%, followed by general insurance at 2.2% and information technology at 2.0%. Cement was the only laggard, declining marginally by 0.4%.

Among individual stocks, First Finance was the top gainer, rising 8.88%, followed by First Janata Bank Mutual Fund and PHP First Mutual Fund, both up 8.82%.

On the flip side, Jute Spinners was the top loser, falling 3.61%, followed by Meghna Condensed Milk and Nurani Dyeing. IPDC Finance, Saiham Textile and Saiham Cotton were among the most actively traded stocks.

The bullish sentiment was stronger at the Chittagong Stock Exchange (CSE), where the Selective Categories' Index (CSCX) gained 37 points to 9,237, while the All Share Price Index (CASPI) rose 60 points to 15,130. Trading activity surged 207%, with turnover reaching Tk51 crore.

The Russian economy runs a risk of going "berserk" if it is run ​to focus entirely on the needs of the military-industrial complex, President Vladimir Putin's international development envoy was quoted ‌as saying on Tuesday.

The comments by Boris Titov to business news outlet RBC were a rare sign of concern in Kremlin circles about the increasing pressure on the slowing economy to secure a victory in the 4-1/2-year war in Ukraine.

Titov, appointed in 2024 as Putin's special representative to international ​organisations for achieving sustainable development goals, is a wealthy businessman who used to own Russia's leading producer of sparkling wine. ​He led an influential business lobby and ran for president in 2018.

"Military and civilian economies have ⁠always existed in symbiosis everywhere. Many technical inventions that are useful for all originated within the military-industrial complex. The key ​lies in maintaining balance," Titov told RBC.

Russia has hiked taxes, embarked on property redistribution, welcomed contributions from businesses to finance the ​war, and, most recently, threatened business owners who are not doing enough to protect their facilities from Ukrainian drones.

War hawks and some government officials often refer to the reorganisation of the Soviet economy under dictator Josef Stalin during World War Two as a model, citing the wartime slogan "Everything for the ​front, everything for victory".

'BERSERK' MODE IS TIME-LIMITED, TITOV SAYS

This approach is met with cautious but growing resistance from various sectors.

"This ​is not an economy at all, it's a kind of 'berserk mode' that can only exist for a very limited time, and the necessity of ‌which ⁠should be considered very carefully," Titov said on the eve of a major economic forum that Putin will attend this week in Russia's Far East.

RBC, which conducted the interview, noted that the term berserk derived from mythological Norse warriors who entered a trance-like state, possibly drug-induced, that enabled them to fight ferociously and ignore pain.

The Russian economy is expected to grow at only 0.4% ​this year, and many non-military ​sectors are stagnating or shrinking. ⁠Ukrainian attacks on economic targets such as refineries, online retailers and oil and grain export infrastructure may push this growth rate even lower.

Titov's comments echo a statement by Moscow's technocrat mayor Sergei ​Sobyanin, who argued last month that "killing a normal economy is equivalent to killing the whole ​country".

Andrei Klepach, the ⁠chief economist at the state development bank, lost his job last month after highlighting the economic challenges posed by the war in a public speech.

Russia will hold a parliamentary election this month, from which the only political party calling openly for an end to the war ⁠had been ​barred. Opinion polls show growing fatigue from the war and support for ​a peace settlement.

Such sentiment is being exacerbated by persistent rumours of a large-scale post-election military mobilisation for a final push to seize the whole of the Donbas ​region of Ukraine. The Kremlin has called such rumours a hoax.

The monthly spending limit under Direct Operator Billing (DOB), a regulated payment mechanism that allows mobile customers to pay for smartphones and other specified goods and services using their mobile balances, has increased by 150 percent to Tk 5,000.

According to the Bangladesh Telecommunication Regulatory Commission (BTRC), the annual ceiling has also risen by 150 percent, from Tk 20,000 to Tk 50,000, in a move aimed at helping people without credit cards or bank accounts make purchases. Previously, smartphones could not be purchased through DOB.

The telecom regulator, following approval from Bangladesh Bank, has raised the limits for six months, according to documents reviewed by The Daily Star.

DOB allows customers to use their mobile phone balance as a payment source, similar to a credit or debit card. It is not a general-purpose mobile wallet and can only be used for specified goods and services.

BTRC officials and industry people said the higher limit would allow customers to purchase smartphones, SIM-based devices and routers, along with other eligible digital products and services. The higher ceiling could also enable smartphone purchases through instalment plans, with payments made from mobile balances.

So far, only Grameenphone has received approval under the revised ceiling. Other operators can also apply for approval, the regulator said.

“The government is trying to increase smartphone penetration, and this would allow customers who do not have access to cards or other banking channels to purchase handsets using their mobile balances,” said Tanveer Mohammad, Grameenphone’s new chief corporate affairs officer.

WHAT DOB CAN BE USED FOR

Customers can use DOB to pay for eligible digital products and services, including digital content, app and in-app purchases, online utility bills, e-ticketing, e-health services, government lotteries, online platform subscriptions and education platforms.

However, mobile balances cannot be used as unrestricted digital money.

The rules prohibit DOB transactions involving financial or speculative activities. Customers cannot use it to buy virtual currencies or similar items used in social media applications and games, including coins, points, credits, coupons, diamonds and gems.

Transactions involving apps that collect investments from the public, provide loans, store money or facilitate other financial transactions are also prohibited.

DOB cannot be used for gambling, casinos, lotteries, cryptocurrency or crypto-asset trading, foreign-exchange trading, stock-market trading or multi-level marketing activities.

For services provided by non-resident merchants requiring foreign-currency remittances, relevant approval from Bangladesh Bank’s Foreign Exchange Policy Department must be obtained where applicable.

LIMITS RAISED AFTER YEARS

The latest increase follows years of gradual expansion of DOB limits.

When DOB was introduced in Bangladesh in 2018, Bangladesh Bank set the monthly spending limit at Tk 600 and the annual ceiling at Tk 3,000.

In December 2025, the central bank temporarily raised the limits to Tk 2,000 per month and Tk 20,000 per year until June 2026. The BTRC subsequently allowed operators to provide the service under those higher limits, subject to Bangladesh Bank’s conditions.

Operators must ensure that digital products and services purchased through DOB are delivered and put measures in place to protect customers. They must also formulate refund and chargeback policies.

DOB operations will be subject to Bangladesh Bank inspections, while mobile operators will be treated as reporting organisations under relevant money-laundering and anti-terrorism laws.

Bangladesh's merchandise exports rose 13.14% year-on-year to $4.43 billion in August 2026, driven by strong growth in ready-made garments (RMG) and several non-RMG sectors, according to the Export Promotion Bureau (EPB).

Exports stood at $3.92 billion in August 2025.

During the first two months of fiscal year 2026-27, merchandise exports increased 5.43% to $9.16 billion from $8.69 billion in the same period a year earlier.
The RMG sector remained the main driver, with exports rising 13.92% to $3.89 billion in August. Cumulative RMG exports in July-August grew 5.12% to $7.50 billion.

Both major apparel segments posted double-digit growth in August, with knitwear exports rising 14.88% and woven garments 12.70%. For July-August, knitwear exports grew 6.17% and woven garments 3.81%.

Non-RMG sectors also recorded strong growth. Jute and jute goods exports rose 37.09% in August, followed by pharmaceuticals at 28.52%, leather and leather goods at 24.85%, printed materials at 24.83%, engineering products at 23.88% and other footwear at 15.29%.

During July-August, exports of printed materials increased 41.89%, pharmaceuticals 38.94%, other footwear 27.32% and jute and jute goods 22.26%.

Mahmud Hasan Khan Babu, president of the BGMEA, attributed the RMG export growth in August partly to a low base in the same month last year, when US reciprocal tariffs contributed to a 3% decline in exports to the US and a 10.43% fall in shipments to the European market. Compared with July 2026, August earnings actually fell by about $278 million, he pointed out.

However, he said the growth reflected the industry's resilience amid the ongoing gas crisis, high interest rates and adverse global trade conditions. Recent government policy support had also helped protect the industry. For a sustainable export recovery, he stressed the need for stronger policy support on energy security, lower interest rates and reducing the cost of doing business while improving the ease of doing business.

US remains top market

The United States, Bangladesh's largest export destination, recorded 26.09% growth in imports from Bangladesh in August. Exports to the US rose 11.90% cumulatively in July-August.

The United Kingdom regained its position as Bangladesh's second-largest export market, followed by Germany, Spain and the Netherlands, according to the EPB.

Infographic: TBS
Infographic: TBS

Among emerging markets, exports to Türkiye surged 141.03% in August, while shipments to South Korea and Saudi Arabia rose 42.37% and 42.09%, respectively.

The EPB attributed the growth to stronger demand in major markets, increased buyer confidence in Bangladesh as a sourcing destination and expanded production capacity. Higher exports of value-added products and efforts to diversify products and markets also contributed, it said.

The latest figures come amid a challenging global trade environment, with exporters facing weaker demand in some markets, shifting sourcing patterns and rising competition from other apparel-producing countries.

The EPB said continued growth in knitwear and woven garments, along with strong performances by pharmaceuticals, leather goods, jute products, engineering goods and footwear, demonstrated the competitiveness and resilience of Bangladesh's export sector.

RMG continues to account for the overwhelming majority of merchandise exports, highlighting the need to sustain growth in non-traditional sectors to diversify the export basket.

The Bangladesh Securities and Exchange Commission (BSEC) has relaxed dividend compliance requirements for foreign investors, tying the remittance deadline to the issuance of a Double Taxation Avoidance (DTA) certificate by the National Board of Revenue (NBR).

The decision was finalised at a commission meeting held today (1 September), according to a press release.

Under the revised guidelines, listed companies must remit declared or approved dividends to non-resident foreign shareholders within 30 days of receiving the DTA certificate from the NBR.

However, the remittance must still be completed within the relevant financial year.

The move is expected to ease a key compliance challenge listed companies have faced in distributing dividends to overseas shareholders.

The BSEC has also revised the timeline for dividend compliance reporting by listed companies. After completing dividend distribution to domestic shareholders, companies will now be required to submit a Preliminary Dividend Compliance Report.

Following the remittance of dividends to foreign shareholders, companies will then have to submit a final Dividend Compliance Report to the BSEC and the respective stock exchange within 30 days of the remittance.

The revised framework is intended to improve transparency while providing companies with greater flexibility to complete dividend payments to non-resident investors.

Previously, listed companies faced difficulties meeting fixed dividend remittance deadlines because obtaining DTA certificates from the NBR could take time. Such administrative delays created a mismatch between the regulatory deadline for dividend payment and the actual availability of the required tax documentation.

By starting the 30-day remittance period from the date of receiving the DTA certificate, the BSEC has sought to align the compliance requirement with the actual process of obtaining tax relief documentation.

Market analysts believe that by linking the 30-day deadline to the receipt of the NBR's tax certificate, the BSEC is providing a more realistic and enforceable timeline for companies.

This clarity is being seen as a positive signal to global fund managers, suggesting that Bangladesh is moving toward international best practices in dividend processing and capital repatriation.

Private firms can buy bad loans from banks, seize mortgaged assets and take over indebted companies under legal provisions readied for enactment, sources say about the desperate remedy for deep-rooted ailment.

A formal market is proposed to be created for buy and sale of bad loans from banks, at a time when commercial banks are burdened with high concentrations of non-performing loans (NPLs).

A new central bank-drafted law moves further to propose inviting both domestic and foreign investors to invest capital in the sluggish banking sector to give a shot in its arm.

The Bangladesh Bank has urged the finance minister to take necessary steps to place the proposed amendment to the Artha Rin Adalat Ain 2003 and the new Distressed Asset Management Act (DAMA) 2026 before parliament during its ongoing session, out of exigency.

The proposed amendment and new law are aimed at making the recovery of defaulted loans more effective, dynamic and time-befitting, while facilitating the management, restructuring and settlement of distressed assets of banks and financial institutions.

Bangladesh Bank Governor Md. Mostaqur Rahman has issued a Demi-Official (DO) letter to the finance minister requesting the enactment of the proposed amendments to the Money Loan Court Act as well as the proposed new DAMA during the ongoing session of parliament.

The central bank has already sent drafts of the two laws to the Financial Institutions Division of the Ministry of Finance for necessary action, according to a letter sent to the ministry.

In the letter, the central bank has said the proposed laws would help accelerate loan recovery, improve the quality of banks and financial institutions' balance sheets and strengthen good governance in the country's banking sector, roiled by past irregularities.

The banking-sector regulator has also sought the ministry's initiative to place the two legislative proposals before the ongoing parliamentary session with the belief that their enactment would contribute to financial stability and help accelerate overall economic activities.

The central bank chief also has written that, soon after assuming office, he took several effective initiatives to revitalise the economy, including reopening closed and capital-starved industrial units to create employment, restoring depositor confidence by reestablishing good governance in the banking sector, expanding the digital economy and raising foreign-exchange reserves to the desired level.

"Nevertheless, the high level of NPLs and distressed assets in the banking sector continues to undermine overall financial stability in the country," the governor notes.

The latest BB move comes as a high level of non-performing loans (NPLs) and distressed assets continues to pose a major challenge to stability in the country's banking sector despite the central bank's different policy supports.

The classified loans in the country's banking sector ballooned to Tk 5.89 trillion as of March 2026, accounting for 32.26 per cent of the entire loans worth Tk 18.25 trillion disbursed by all scheduled banks.

The main objective of the DAMA is to create a formal market for buying and selling bad loans. The law also aims to attract both domestic and foreign investors and strengthen the financial system.

The proposed DAMA would allow private firms to purchase bad loans from banks, seize mortgaged assets and take control of indebted companies.

The draft also proposes establishing an independent regulator, Distressed Asset Management Unit (DAMU), under the oversight of the central bank.

It would also have the authority to establish a special enforcement body, styled Distressed Asset Enforcement Taskforce (DAET).

The government has taken an initiative to enact the DAMA in line with recommendations from the World Bank, the International Monetary Fund (IMF) and the Asian Development Bank (ADB) to improve the efficiency of managing classified loans and distressed assets in the banking sector, according to officials familiar with the developments.

They also said the central bank recommended settling cases related to the Artha Rin Adalat Ain or Money Loan Court Act within the timeframe of six months.

The draft law also proposes forming Appeal Tribunal, determining reserve prices in auction, appointing recovery officer in execution cases and for filing appeal to increase the amount of deposit money.