The country's premier bourse returned to a bearish phase last week as the benchmark index plummeted by nearly 100 points, driven by acute selling pressure.

A combination of persistent industrial energy shortages and broader macroeconomic concerns triggered a wave of cautiousness, leading investors to offload shares across the board.

The benchmark DSEX index of the Dhaka Stock Exchange (DSE) shed 97 points, or 1.65%, to close the week at 5,786. The blue-chip DS30 index followed a similar downward trajectory, falling 30 points to close at 2,162.

The market breadth was overwhelmingly negative, with 314 issues declining against only 52 that advanced, while 18 remained unchanged.

The fall in share prices wiped Tk3,800 crore from the DSE's total market capitalisation by the end of the week.

Trading activity also saw a contraction, with the daily average turnover dropping by 9.2% to Tk905 crore, down from the previous week's Tk997 crore.

According to EBL Securities' weekly market review, the capital bourse faced persistent downward pressure as investors remained wary of evolving regulatory developments.

The week began with cautious positioning as participants awaited the finalisation of amended margin rules. Although the long-awaited clarification on these regulations was eventually announced, market momentum failed to recover as persistent rumours regarding potentially stringent enforcement measures induced further panic.

"The unresolved national gas crisis has significantly raised concerns over future corporate earnings," EBL Securities noted. "This prompted many investors to reduce their equity exposure, keeping confidence fragile despite a brief late-session rebound toward the end of the week."

Sheltech Brokerage Limited echoed these sentiments, identifying the energy crisis as a primary shaper of market sentiment. The firm noted that even though margin lending rule amendments were finalised midweek, selling pressure persisted.

The pressure was further intensified by media reports suggesting aggressive regulatory action against market manipulators. Although the Bangladesh Securities and Exchange Commission (BSEC) issued a clarification denying such reports, the "surveillance ghost" continued to dominate the trading floor.

Sector-wise, the textile sector remained the most active, accounting for 21.2% of the total weekly turnover, followed by general insurance at 17.9% and the engineering sector at 9.6%.

Performance across almost all sectors was weak. The jute sector suffered the steepest correction, falling 4.6%, followed by paper and printing, which declined 4.5%, and mutual funds, which fell 4.4%.

Services and real estate was the only sector to record a gain, rising a marginal 0.2% during the week.

On the liquidity front, IPDC Finance, Dominage Steel, and Sharp Industries were the top turnover leaders.

In terms of price movement, Envoy Textile led the gainers' list with a 15.8% surge, followed by Al-Arafah Islami Bank and Reliance One Mutual Fund.

On the flip side, Sharp Industries was the week's worst performer, losing 22.1% of its value. Dominage Steel followed with a 21.1% decline, while ML Dyeing fell 15.3%.

The bearish sentiment was mirrored at the Chittagong Stock Exchange (CSE), where the Selective Categories' Index (CSCX) ended 2.04% lower at 9,430 and the All Share Price Index (CASPI) dropped 1.97% to settle at 15,491.

Bangladeshi exporters will continue to enjoy preferential access to the UK market after Bangladesh graduates from the least- developed-country status, the United Kingdom has assured.

Economists say the UK's decision provides Bangladesh with valuable policy space and greater certainty on the cusp of transition from the world's poor-country club.

A letter from the British mission in Bangladesh says 92 per cent of goods will continue to qualify for duty-free access without the need for Bangladesh to negotiate a separate trade agreement with the UK.

The letter, dated August 19, from James Goldman, Deputy High Commissioner and Development Director at the British High Commission in Dhaka, was sent to Md Ataur Rahman Khan, Secretary of the Ministry of Commerce.

p1-lead-outlineBangladesh currently enjoys tariff-free access for 99.8 per cent of goods exported to the UK under the UK's Developing Countries Trading Scheme (DCTS).

According to the communication in writing, Bangladesh will retain its existing market access for three years after its LDC graduation, providing exporters with a transition period before moving to a new preferential arrangement.

Following the transition period, Bangladesh will move to the Enhanced Preferences tier of the DCTS, under which 92 per cent of goods will continue to qualify for duty-free access without requiring further renegotiation.

Commerce ministry's senior officials have said apparel and readymade garments are within the 92-percent duty access list, so reduction in ratio won't affect Bangladesh's export.

Talking to the FE on Thursday, Commerce Secretary Md Ataur Rahman Khan termed it a significant assurance allowing Bangladesh to increase its capacity, diversify export and find new market.

"We hope to get three years' extension to stay as LDC until November 2029, so the existing duty benefit will remain unchanged for next three years," he said.

Trade economist Dr Masrur Reaz also takes it as a significant massage from the British High commission that would give a huge comfort to the apparel exporters.

Dr Reaz, chairman of the Policy Exchange Bangladesh, says when all other countries' preferential-trade benefit will expire with the LDC graduation, the UK will retain it.
"The letter made it clear that there is no expiration date of UK's preferential trade benefit," he says.

In this period, he suggests, Bangladesh must act seriously to sign free-trade agreements with the major trade partners to retain the trade benefits to avail after LDC graduation.

In the letter, the British government has also provided specific reassurance to Bangladesh's garment sector, the country's largest export earner.

Dr Mohammad Abdur Razzaque, Chairman of Research and Policy Integration for Development (RAPID), finds this as a welcome news for Bangladesh as it prepares for LDC exit.

"The UK has provided considerable certainty by confirming that Bangladesh will retain its existing market access for three years after graduation and will then move directly into the Enhanced Preferences tier of the DCTS."

For Bangladesh, he says, the most important aspect is the treatment to garments, which account for the overwhelming majority of the country's exports to the UK.History

"Market access for garments will remain unchanged under the Enhanced Preferences arrangement."

Equally important are the UK's revised rules of origin, which provide substantially greater flexibility in sourcing imported inputs and do not impose a double-transformation requirement.

This is particularly relevant for Bangladesh's garment industry, given its dependence on imported fabrics and other intermediate inputs in several product categories, Dr Razzaque further notes.

It is also important to recognise that the UK Government introduced these changes to its rules of origin autonomously.

"The changes, therefore, demonstrate the UK's recognition of the adjustment challenges facing Bangladesh and other graduating LDCs, while providing particularly important benefits for Bangladesh because of the scale and composition of its exports to the UK."

This is a positive example of how major trading partners can support a smoother LDC transition, he has said.

The combination of the three-year transition period, subsequent access to Enhanced Preferences, and more liberal rules of origin considerably reduce the immediate market-access risks associated with Bangladesh's graduation.

"Preferential access by itself cannot guarantee export growth. The priority should be to improve competitiveness, diversify products, make effective use of the more flexible sourcing provisions, and ensure that exporters understand and utilise the DCTS rules," he suggests.

The challenge for Bangladesh is to translate that opportunity into stronger and more diversified exports, economist observes.

Market access for garments covered by chapters 61 and 62 will remain unchanged under the Enhanced Preferences tier, according to the letter.

The updated rules of origin will also ease compliance requirements for garment exporters.

They will no longer be required to meet the existing "double transformation" requirement to qualify for preferential market access.

The new rules will provide exporters with greater flexibility to source inputs from a wider range of countries while retaining eligibility for preferential tariffs.

The UK is one of Bangladesh's major export destinations, particularly for readymade garments.

The continuation of preferential access is, therefore, considered important for maintaining the competitiveness of Bangladeshi products following graduation.

The British High Commission will also work with the Export Promotion Bureau (EPB) to organise a series of workshops for exporters and other trade stakeholders.

The workshops will focus on helping businesses better understand and utilise the benefits available under the DCTS, the letter reads.

Garment export to the UK registered .91-percent growth in the last fiscal year while it was negative 3.31 per cent in total EU zone.

Global apparel buyers are largely maintaining their orders from Bangladesh despite being concerned whether suppliers can meet deadlines amid the country's prolonged gas crisis.

For now, the orders are holding – but at a growing cost for manufacturers.

Representatives of four leading international buyers told TBS that their companies had no plans to reduce orders, while one said its orders had rather increased slightly in recent weeks.

The buyers said none of their suppliers had delayed shipments, despite factories struggling with the gas shortage and relying on costly alternative fuels to keep production running.

Moyeen Chowdhury, head of the Dhaka office of sportswear brand Puma, said exporters were struggling with rising costs but continuing to meet their commitments.
"We have no plans to reduce orders," he told TBS.

TBS also spoke to six exporters, and except for one, none reported a decline in export orders. However, a textile mill said it was limiting the orders it accepted despite having buyers because it could not ensure adequate production amid the gas shortage.

Bangladesh has been grappling with a gas shortage for the past two years. The crisis intensified following disruptions to global fuel supply chains after the outbreak of conflict in the Middle East and worsened further in July when a floating LNG terminal broke down.

The gas crisis has disrupted production across major industrial belts, forcing some factories to suspend operations and others to rely on expensive alternative fuels. Manufacturers are incurring heavy losses, while concerns are growing over possible worker layoffs.

Against this backdrop, members of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) are scheduled to meet today to determine their next course of action.

Bangladesh, the world's second-largest apparel exporter, shipped $38.7 billion worth of garments in FY26, while total textile exports approached $40 billion.
The textile sector, which forms the backbone of the apparel industry, is heavily dependent on gas. Textile mills use gas to generate captive power and operate boilers to produce yarn and fabric for garment manufacturers.

The government had assured industries that the gas situation would improve by 14 August. But industrialists said there had been no significant improvement as of 20 August.

Buyers remain committed
The head of the Dhaka office of a leading US-based buyer told TBS on condition of anonymity that the company had no plans to reduce orders from Bangladesh.
The brand imports more than $1 billion worth of apparel from Bangladesh annually and has more than 100 local suppliers.
"Almost all of them are delivering on time, although we can see that they are struggling," the representative said. "Factories are having to buy diesel to keep production running, pushing up their costs, but they are still meeting delivery commitments," he said.
The buyer's suppliers include all of Bangladesh's top 10 exporters, including Jaber & Zubair and Square, and none had so far missed delivery deadlines, he added.
A senior official of another European buyer said its suppliers were also continuing to deliver on time. "We have no plans to reduce orders. In fact, our orders have increased slightly in the past two weeks."

The managing director of a leading Bangladeshi exporter with annual exports of more than $600 million said none of its buyers had indicated plans to cut orders. "However, they are regularly checking on the situation. They are concerned and frustrated."
Shovon Islam, managing director of Sparrow Group, which exports around $350 million a year, said they were using diesel to keep factories running but had not missed any shipments.

"None of our buyers has told us they will reduce orders," he said, adding that diesel use was increasing the company's costs by around Tk3 crore a month.

One exporter reports order cut
BKMEA President Mohammad Hatem, who is also MD of MB Knit Fashions, said one of his European buyers had reduced its order by one-third from its original commitment.
"Because of the gas crisis, they don't want to take the risk," he said.

Azhar Khan, chairman of textile mill Methela Group, said gas pressure at his factory was currently just 0-1 PSI against the required level of more than 10 PSI.
"We're using alternatives to keep production running, but even then we can't operate at more than 60% of capacity. Buyers want to place orders, but we are unable to accept them," he told TBS.

Factories turn to costly alternatives
Exporters said many are increasingly turning to solar power, rice husk, diesel, batteries and even wood to keep production running.

"We are using rice husk to run our boilers," said Inamul Hoque Khan Bablu, managing director of Ananta Garments.

Azhar Khan said his company was also using rice husk and diesel to maintain production.

Some weaving mills in Narsingdi have resorted to burning wood, while others are using rice husk to run their boilers, Bablu said.

Many factories are also relying on diesel, which costs three to four times more than gas, significantly raising production costs.

BKMEA to decide next steps
BKMEA members will meet today to discuss the ongoing gas crisis and decide what steps industrialists should take, Hatem said.

"We have arranged the meeting to determine what industrialists should do in the face of the ongoing gas shortage," he said. "We will make a decision after the meeting. We may hold a press conference on Sunday to announce our position," Hatem added.

Bangladesh is set to begin formal negotiations with the European Union in September on a proposed free-trade agreement (FTA), as the country moves to secure long-term market access ahead of its LDC graduation.

A senior Commerce Ministry official says the ministry's FTA wing has already completed its preparatory work.

"The paperwork is done. We are now ready for the next steps," the official adds.

Formal talks are expected to begin in the second week of next month, although details as to whether the delegations will meet in Europe or in Bangladesh are still being finalised.

The ministry is prioritising the removal of non-tariff barriers (NTBs) and improvements in trade facilitation, including the introduction of a national single-window system. It is also preparing a pool of trade experts to support the negotiations.

"We are addressing issues raised earlier by the EU and working to improve the overall business environment," the official told The Financial Express.

Commerce Minister Khandakar Abdul Muktadir has said Bangladesh is pursuing FTAs with major partners, including the EU, to safeguard preferential market access after graduation from the least-developed country (LDC) status.

"We are working to ensure continued market access for Bangladeshi exporters before graduation," he said.

The EU has also signalled its readiness for exploratory talks but has urged Bangladesh to take concrete steps to remove NTBs and improve the investment climate. Both sides have already discussed trade facilitation, regulatory reforms and investment conditions.

Regarding the FTA with the European bloc, BGMEA President Mahmud Hasan Khan has said informal discussions on the agreement have already begun, while formal negotiations are expected to start in September.

"Bangladesh would also wait for the UN General Assembly, as any delay in the country's LDC graduation would provide some relief to exporters. However, FTA negotiations would continue regardless of the outcome of the graduation process."

BKMEA President Mohammad Hatem says the government has formed a committee and is working on the issue, while the business community is also assisting the government.

He says discussions on the FTA are expected to begin in September and Bangladesh should conclude the negotiations as soon as possible. "With India and Vietnam already having FTAs with the EU, Bangladesh could face intense competition in the European market if it fails to secure a similar agreement."

He feels that Bangladesh should aim to conclude the FTA before 2029 to safeguard its competitiveness on the EU market.

Talking to the FE, Policy Exchange Bangladesh founder Dr M. Masrur Reaz said a comprehensive FTA would be crucial for Bangladesh to remain competitive on the EU market after LDC graduation and the gradual phase-out of preferential schemes.

"Bangladesh has to put together a very serious diplomatic effort to secure the EU's formal interest in starting the FTA negotiations," he added.

The EU remains Bangladesh's largest trading partner, accounting for 21.5 per cent of the country's total goods trade in 2025, according to the European Commission.

According to the EC data, two-way merchandise trade stood at €23.3 billion in 2025, with the EU recording a €19.1-billion deficit. Apparel and textiles made up nearly 94 per cent of Bangladesh's exports to the bloc, while EU exports were led by machinery, appliances and chemicals.

Despite strong trade flows, investment remains limited. EU foreign direct investment stock in Bangladesh stood at €2.5 billion, as of 2024, compared to €86 million from Bangladesh in the EU.

Bangladesh currently benefits from duty-free, quota-free access under the EU's Everything But Arms (EBA) scheme. After LDC graduation, it is expected to retain EBA preferences for three more years, until 2029, and may later seek GSP+ status to maintain preferential access.

Strategic push for post-LDC trade: Dhaka is pursuing FTAs with multiple partners as part of its post-LDC strategy to diversify export markets and reduce reliance on unilateral preferences.

The urgency has increased as competitors such as Vietnam already enjoy an FTA with the EU, giving them stronger market positioning.

EU Ambassador Michael Miller earlier said the bloc is ready for exploratory FTA talks and had already shared a proposal with Bangladesh. Discussions have also covered NTB removal, trade facilitation and investment reforms.

A broader Partnership and Cooperation Agreement (PCA) is also under negotiation, covering trade, governance, human rights, climate action and sustainable development.

Talking to the FE, Dr Mostafa Abid Khan, component manager of the Support to Sustainable Graduation Project (SSGP) and a former member of the Bangladesh Trade and Tariff Commission, said the EU had given Bangladesh a list of non-tariff barriers (NTBs) that it needs to address before starting negotiations.

"If the government addresses these issues beforehand, it will help create a favourable environment at the negotiation table," he said.

The new government is also keen to undertake various reforms, and the trade-negotiation expert notes that the FTA discussions could help facilitate those reforms. "We have to start this immediately, as the trade bloc is an export destination for 45 per cent of our goods," he said.

As Bangladesh's major trading partner, signing an FTA with the EU could be a significant move for the country.

In the EU market, Bangladesh's major apparel competitor India is set to secure duty-free market access, while Vietnam will also enjoy the same facility by 2029 under its FTA with the bloc.

"It might also play a major role as the country is scheduled to graduate from the least-developed-country status," he added.

He also suggests that, beyond signing trade agreements, Bangladesh must complete the necessary reforms to facilitate smooth trade.

Restoring depositors' confidence in the banking sector was a major challenge for the BNP government as it inherited the most troubled financial sector in the country's history, with the default loan ratio exceeding 36% and dozens of banks unable to repay depositors.

However, in the first six months of the new government, the country's banking sector gradually stabilised, while a majority of depositors of the five merged banks received their money from government allocations. The Bangladesh Bank also moved to repay depositors by liquidating five non-bank financial institutions that are no longer viable.

The cabinet also approved the draft of the Bank Resolution (Amendment) Act, 2026, repealing the controversial provision that allowed former directors or owners of banks undergoing or slated for mergers to regain control under relatively favourable terms.

Under the amended law, the Bangladesh Bank moved to restructure the troubled financial sector by restricting, merging and liquidating ailing financial institutions, sending a strong message to owners to strengthen corporate governance.

However, managing default loans remained a major challenge for the banking sector as more than 20 banks have been facing a combined capital deficit of over Tk2 lakh crore, constraining their lending capacity.

In this context, the Bangladesh Bank introduced a Tk60,000 crore stimulus and refinancing package to revive closed factories, support struggling industries and restore private-sector investment. The package includes a Tk41,000 crore fund pooled from banks with excess liquidity and a Tk19,000 crore direct allocation from the central bank.

The foreign exchange market has also remained broadly stable, with the dollar rate holding steady while foreign exchange reserves increased by over $2 billion to more than $32 billion in the last six months, according to International Monetary Fund calculations.

However, inflation, which is one of the central bank's core monetary policy objectives, has not yet fallen to the expected level despite some decline.

Inflation fell to 8.32% in July from 9.13% in February, when the BNP government took office.

Muhammad A (Rumee) Ali, former deputy governor of Bangladesh Bank, said the government would have to take some tough decisions to address problems regarding capital adequacy, non-performing loans (NPLs), and lack of governance.

He questioned the policy of using taxpayers' money to keep weak banks afloat, saying it would require a huge amount of funding, the burden of which would ultimately fall on taxpayers.

He also placed particular emphasis on the autonomy of the central bank and the government's control over state-owned banks.

Rumee said, "The government will have to set specific targets and implement them while taking political realities into account."

Bangladesh's risk has increased internationally because of weaknesses in the banking sector, he said. "As a result, the cost of LC confirmation has risen, imported goods have become more expensive, and the overall supply chain is facing additional costs."

Despite these challenges, however, Rumee believes the government is making its best efforts to address the situation.

Fahmida Khatun, executive director of the Centre for Policy Dialogue, said several positive steps had been taken to improve the banking sector during the government's first six months. In particular, the government introduced a stimulus package worth around Tk60,000 crore to create employment and expand banking business, she said.

"The Bangladesh Bank now needs to properly monitor the implementation of these packages and ensure that the funds are used appropriately, Fahmida said.

She said restoring depositors' confidence must be given the highest priority. "Without regaining depositors' trust, there is no scope for the banking sector to recover. In particular, the new bank created through the government's merger initiative is a major test for the government. The initiative must be made successful at any cost."

Fahmida said as export earnings have not recorded significant growth, the government needs to take initiatives to engage expatriate Bangladeshis more closely in strengthening the economy. It should focus on improving their skills and ensuring non-stop services for expatriates, she said.

Referring to the government's commitment to ensuring Bangladesh Bank's autonomy and keeping state-owned banks free from the intervention of the finance ministry, the economist said the government must prioritise these issues and take effective steps within a short period.

"Above all, full transparency and good governance must be ensured in the banking sector. The government must ensure that the scale of losses suffered in the past is not repeated and that there is no further misuse or misappropriation of loans," she said.

Measures taken to revive the economy, accelerate digital transformation
During the government's first six months, the key positive initiatives in the banking sector included recovering defaulted loans, expanding digital transactions, stabilising the foreign exchange market, and increasing the flow of funds to productive sectors.

The integrated stimulus package introduced to increase the flow of funds to various critical sectors of the economy is expected to help create around 25 lakh new jobs.

While the normal lending rate in the banking sector stands at around 13%-14%, loans under these stimulus packages are being offered at much lower interest rates of just 4%-6%. This has provided significant relief to industrial entrepreneurs and is expected to support the revival of industries and new investment.

Special lending programmes through banks have been strengthened to ensure timely financing for farmers and widen access to loans for startups, young entrepreneurs and small businesses, moving beyond collateral-based lending.

The central bank has taken major steps to expand and make "Bangla QR" more effective as part of efforts to reduce reliance on cash and expand the use of digital transactions across the economy. Until now, it has primarily been used for payments at shops and merchant outlets. However, preparations are now underway to introduce person-to-person transactions through the system.

Recent Bangladesh Bank data also show a sharp rise in the use of Bangla QR. In January this year, around 723,000 transactions were conducted through Bangla QR, but the number surged to 6.255 million in July. Over the same period, the value of transactions increased from Tk212 crore to around Tk1,476 crore.

Long-term roadmap to reduce NPLs, strengthen governance
When the BNP government took office, non-performing loans (NPLs) accounted for around 32% of total loans, placing Bangladesh among the countries with the highest NPL ratios in the world. To reduce bad loans and restore good governance in the banking sector, both short- and long-term reform measures are being prioritised.

To expedite loan recovery, steps are being taken to speed up the resolution of pending court cases and strengthen banks' own recovery mechanisms.

In March 2026, detailed guidelines were issued for implementing the international accounting standard IFRS 9. Under the framework, banks will have to calculate potential credit losses in advance using the Expected Credit Loss approach from 2028. In addition, a fresh Asset Quality Review is being undertaken to accurately assess banks' loan portfolios, the actual quality of their assets, non-performing loans and potential losses, without concealing the extent of the risks.

Facilitating foreign transactions and preventing money laundering
During the first six months of the BNP government, the Bangladesh Bank took several notable measures to facilitate foreign currency transactions, bring remittances and export proceeds into the country, and restore stability to the dollar market.

The Bangladesh Bank has allowed authorised dealer banks to partner with cross-border digital payment service providers, such as PayPal and Payoneer, to facilitate foreign transactions and the processing of outward remittances. This has made it easier for freelancers and online businesses to bring their earnings into the country. The process for making tuition fee payments to foreign universities through banking channels has also been made easier.

Efforts to recover money allegedly siphoned abroad have been significantly strengthened through international legal initiatives in the banking sector. For the first time, banks have been directed to engage international law firms to identify funds and assets linked to the country's top 10 business groups accused of siphoning money abroad. Subsequently, another 42 companies – each with more than Tk200 crore in default loans – were brought under the initiative, with plans underway to engage eight more international law firms.

Moves that drew criticism
Alongside its positive initiatives, several weak policy decisions, controversial appointments and institutional short-sightedness on the part of the government have further deepened the crisis in the banking sector.

Amid efforts to reform the banking sector, a government decision sparked widespread controversy. Section 18(a) was newly inserted into the Bank Resolution Act, 2026, which was passed by parliament on 10 April this year. The controversial provision allowed former shareholders or disputed owners of banks undergoing mergers or resolution to apply, subject to certain conditions, to regain shares, assets and liabilities of those banks.

The provision drew strong criticism from bankers, economists, governance advocates and others amid concerns that it could create an opportunity for former owners linked to irregularities, loan fraud and poor management in the banking sector to regain control. Transparency International Bangladesh described the provision as posing a risk of "impunity" in the banking sector and the recurrence of past irregularities.

Ultimately, following intense criticism, the government was forced to reconsider its position. On 11 August, the Cabinet approved the draft Bank Resolution (Amendment) Act, 2026, which completely repealed the controversial provision.

During this period, the Bangladesh Bank issued a controversial "exit policy" or circular as part of its efforts to reduce non-performing loans. Under the circular, defaulting borrowers of banks and financial institutions have been given a significant one-time concession, allowing them to have both accrued and unaccrued interest waived if they repay only the principal amount of their loans.

While the measure may temporarily help clean up banks' balance sheets by reducing the burden of non-performing loans, it has raised concerns among bankers and economists who warn that the measure could significantly increase the risk of wilful default becoming more widespread across the banking sector.

The BNP made a major commitment in its election manifesto to increase the autonomy of the Bangladesh Bank as part of financial-sector reforms and to remove state-owned banks from the administrative control of the Financial Institutions Division of the finance ministry, placing them fully under the control of the central bank. However, even after the first six months of the government, no major or effective steps have yet been seen in this regard.

Central bankers and stakeholders in the banking sector have stressed that practical institutional reforms are needed to end political and administrative interference in the appointment of the governor and senior officials, the formation of boards of directors, policymaking and the management of state-owned banks.

The lack of progress on these reforms during the first six months means that political and administrative influence over state-owned banks remains largely unchanged, which is considered one of the major factors behind the rise in non-performing loans.

The proposed establishment of a Mortgage Refinance Company (MRC) in Bangladesh could open a new avenue for raising long-term funds from the capital market and help expand access to long-term housing finance.

The institution could mobilise funds by issuing corporate bonds and mortgage-backed securities (MBS), which could then be used to provide long-term refinancing to banks and financial institutions.

The World Bank Group has begun assessing the feasibility of establishing an MRC in Bangladesh following a formal request from the Financial Institutions Division (FID) of the Ministry of Finance.

An MRC could help address a key constraint in Bangladesh's housing finance market, where banks and financial institutions largely rely on short-term deposits to finance long-term housing loans.

By providing a dedicated refinancing facility, the proposed institution could help lenders access longer-term funding and potentially support the development of a deeper market for housing-related securities.

The initiative could also create new investment instruments for institutional investors, including pension funds, insurance companies and other long-term investors, while broadening the country's capital market financing base.

As part of the initiative, a World Bank Group delegation met with the Bangladesh Securities and Exchange Commission (BSEC) yesterday (19 August). BSEC Chairman Masud Khan chaired the meeting at the commission's office.

The meeting discussed the potential structure and operations of the proposed Mortgage Refinance Company (MRC), as well as its possible role in expanding housing finance and deepening the capital market.

An MRC can play an important role in providing long-term liquidity to the housing sector and developing the bond market. Commercial banks typically collect short-term deposits and provide long-term home loans, creating a maturity mismatch and liquidity risk.

An MRC can raise long-term funds through bonds and use the proceeds to refinance banks' mortgage portfolios. This would provide banks with liquidity and enable them to expand their capacity to issue new housing loans.

Similar mortgage refinancing structures are operating in countries such as India, Pakistan and Malaysia. Establishing an independent MRC in Bangladesh could also help expand access to affordable, long-term housing loans, particularly for middle- and lower-income households.

An earlier TBS report, citing a World Bank policy paper, said the proposed MRC could raise funds from the capital market by issuing corporate bonds and mortgage-backed securities. This could increase the supply of long-term fixed-income instruments and create new investment opportunities for institutional investors.

Bangladesh's mortgage market remains underdeveloped

Bangladesh's relatively small mortgage market highlights the need for a Mortgage Refinance Company (MRC).

According to World Bank data, total housing finance loans stood at Tk105,890 crore as of June 2022, equivalent to 7.8% of total private-sector credit and only 2.7% of GDP.

Compared with countries with similar per-capita GDP, Bangladesh's mortgage market remains significantly below its potential. Mortgage debt should be around 6.5% of GDP, according to the World Bank, indicating an additional lending opportunity of around Tk90,000 crore.

Bangladesh also needs around 432,000 new housing units annually, further increasing demand for affordable, long-term housing finance.

The World Bank's 2025 Country Private Sector Diagnostic identified housing for middle-income households as a promising investment sector and recommended developing the legal and regulatory framework for an MRC.

Bond market remains a key challenge

However, Bangladesh's underdeveloped corporate bond market could pose a major challenge to the MRC model.

Experts cited in an earlier TBS report warned that weak demand in the bond market could make MRC bond issuance difficult. Former World Bank economist Zahid Hussain said banks could become the main buyers if the bond market remains weak.

The feasibility study will therefore need to assess the MRC's capital structure, regulatory framework, refinancing model and ability to raise funds from the capital market.

The Invest Bangladesh Authority, formed by merging the Bangladesh Investment Development Authority (Bida), Bangladesh Economic Zones Authority (Beza) and Public-Private Partnership Authority (PPPA), formally began operations today (20 August).

The government issued a gazette notification bringing the Invest Bangladesh Act, 2026, into force.

The notification, signed by Principal Secretary to the Prime Minister ABM Abdus Sattar by order of the president, said the government had brought the Act into effect using powers granted under Section 1(2).

However, the full organisational structure of the new authority, including its wings and teams, will be developed in phases, said Nahian Rahman Rochi, former Bida executive member and head of business development.

"With the gazette now in effect, everything will operate under the Invest Bangladesh name. Formation of the new teams and wings, along with the remaining work, will now begin in phases," Rochi told The Business Standard.

He said the authority had formally become operational and the remaining organisational work would proceed gradually.

"We are delighted that, after months of work, Invest Bangladesh has now gone live and begun its journey. The genesis of this initiative came directly from investors telling us that they wanted one front desk for all investor services," Rochi said.

Our objective will be to make Invest Bangladesh that single point of access, providing investors with a more coordinated, seamless and accountable experience throughout their investment journey, he added.

Under the law, the Invest Bangladesh Authority will operate as a statutory body, with its headquarters in Dhaka. With government approval, it will be able to establish branch offices elsewhere in the country and liaison offices abroad.

The authority will have a chairman and seven members to run its regular operations, with the chairman serving as chief executive.

Its key responsibilities will include identifying investment opportunities, promoting domestic and foreign investment, removing investment barriers and coordinating with relevant ministries and government agencies.

Following the merger, all existing assets, records, contracts, liabilities and other matters of Bida, Beza and PPPA will be transferred to the new authority. Employees of the three dissolved agencies will also work under Invest Bangladesh.

The new authority is expected to provide more integrated services to investors and reduce barriers to investment, formally completing the long-running merger process.

Investing a portion of remittance inflows in small and medium enterprises (SMEs) will create new jobs, strengthen the local economy and open up new opportunities for future generations, IOM Bangladesh Chief of Mission Laura Tomm Bonde said today (22 August).

"When migration is safe, regular and orderly, its benefits are not limited to an individual migrant," she said while addressing a mock parliamentary debate as chief guest at the Bangladesh Film Development Corporation (FDC) in the capital to mark International Day of Family Remittances 2026.

The event was jointly organised by Debate for Democracy and IOM Bangladesh, with support from the European Union.

Laura Tomm Bonde said safe, regular and orderly migration contributes to the overall development of families, society and the country, while every remittance reflects the hard work, resilience and sense of responsibility of Bangladeshi expatriates.

She emphasised that directing a portion of remittances into the SME sector would boost local economic momentum and create sustainable opportunities for future generations.

"IOM is working closely with the government to improve migration management and ensure the protection of migrants," she added.

Chairing the event, Debate for Democracy Chairman Hasan Ahmed Chowdhury Kiron described expatriate workers as the nation's economic heroes, saying remittances serve as a key driver of the economy and a major pillar of foreign exchange reserves.

He said migration is directly linked to the employment of nearly 25% of Bangladesh's workforce, adding that the national poverty rate would have been roughly 10% higher without overseas employment opportunities.

Kiron stressed the importance of channelling remittances into productive investments, particularly SMEs, rather than using them solely for consumption, to ensure the long-term financial stability of migrant families.

In the debate competition titled "Investing Remittances in the SME Sector is the Best Strategy for Protecting Migrant Families", Dhaka International University emerged as the winner, defeating the debating team from the State University of Bangladesh.

Inward remittances through mobile financial services (MFS) declined by nearly 21 per cent in June over the previous month, according to Bangladesh Bank (BB).

According to the BB figures, wage-earner remittances received through MFS stood at Tk 22.29 billion in June compared to Tk 28.18 billion in May.

The decline was recorded in both rural and urban areas, indicating a slowdown in the inflow of wage-earner remittances through digital financial channels during the month.

Remittance inflow through MFS in rural areas fell to Tk 12.40 billion in June from Tk 15.66 billion in May and that of urban areas declined to Tk 9.88 billion from Tk 12.52 billion during the same period.

An MFS official, preferring anonymity, said the fall in the inward remittance through MFS in June could be attributed partly to the seasonal impact following Eid-ul-Azha, which was observed in May this year.

Remittance inflows typically rise ahead of Eid festivals as migrant workers send more money to their families, resulting in a slowdown in the following month, he added.

On the other hand, total remittance inflow also declined by 18.02 per cent to over $2.82 billion in June FY 26 from $ 3.44 billion in May.

Mobile Financial Services (MFS) have significantly expanded financial inclusion in Bangladesh by providing accessible, secure and convenient digital financial services to millions of people, particularly in rural and underserved areas.

The growing use of MFS has made it easier for migrant workers' families to receive remittances quickly and conveniently, while also reducing their dependence on traditional banking channels.

Dr Masrur Reaz, Chairman of Policy Exchange Bangladesh, said the decline in remittances through MFS in June should not necessarily be viewed as a weakening of overall remittance inflows, as the movement of remittances between digital and traditional banking channels can vary from month to month.

He said the growing use of MFS has played an important role in expanding financial inclusion, particularly by connecting rural households and people with limited access to formal banking services to the financial system.

MFS statistics cover major providers such as bKash, Nagad, Rocket and Upay. The providers offer various services, including person-to-person (P2P), business-to-person (B2P) and government-to-person (G2P) transactions.

Meanwhile, the e-money balance held in MFS accounts declined significantly to Tk 195.07 billion in June from Tk 241.65 billion in May.

The number of MFS accounts increased marginally by 0.47 per cent to 256.97 million in June.

Total volume of MFS transactions also fell in June, standing at Tk 2.08 trillion, down 15.59 per cent from the previous month.

Despite the decline in the transaction volume and the amount of inward remittances through MFS, the continued expansion of MFS accounts indicates the growing reach of digital financial services across the country.

Dr Reaz said: "Digital financial services have become an important channel for delivering remittances to households, especially in rural areas. Therefore, any decline in MFS-based remittance needs to be assessed alongside overall remittance flows and the use of other formal channels.

Sustaining the growth of digital financial services would require greater consumer confidence, reliable digital infrastructure, competitive transaction costs and stronger safeguards against fraud and other financial risks, he said.

He further said Bangladesh needs to focus not only on increasing the number of MFS accounts but also on encouraging regular and productive use of those accounts, as deeper digital financial inclusion can help households save, make payments and access a wider range of formal financial services.

The US imposed 50% tariffs on some Canadian goods on Saturday after the two longstanding allies failed to reach a trade deal, with each side accusing the other of derailing days of talks.

The tariffs that came into effect just after midnight (0400 GMT) on some $20 billion of Canadian goods - things like wooden ice hockey sticks that are rarely used anymore - are far from an economic game-changer for the largest US trading partner after Mexico. That represents just over 5% of Canada's exports to the US.

But the new tariffs mark an increase in tensions between President Donald Trump and Prime Minister Mark Carney, and will likely make broader talks to renew the US-Mexico-Canada free trade agreement more difficult.

Carney said he had suspended trade negotiations and Canada would retaliate "dollar for dollar" on the new tariffs.

"I have decided to suspend trade negotiations with the US and have directed Canada's negotiators to return to Ottawa," Carney said in a statement.

"They (negotiators) have worked hard, in good faith, to defend the interests of Canadians throughout these negotiations up until the very last minute," he said. "However, last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal."

Carney, the only person to ever run the central banks of two major economies, was elected last year on promises to stand up to Trump, and remains broadly popular. Polls show most Canadians oppose making any concessions to Trump.

Hours earlier, the two sides had seemed close to an agreement that sources said would have lowered tariffs on steel, aluminium and autos and potentially brought American alcohol back to Canadian liquor stores.

"Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week," US Trade Representative Jamieson Greer said during a White House briefing.

"This is a missed opportunity for Canada to partner with the United States, which is the fastest-growing economy in the G7," Greer said.

A senior Trump administration official said the US offer would have put Canada in the best tariff position of any major exporter to the US, but that Canada had sought additional concessions, especially on steel, aluminium, autos and softwood lumber.

No additional talks are scheduled as the US implements the new duties, the official said.

Trump last month threatened to impose a raft of duties on a range of Canadian imports including wine, furniture, dairy products, cement, clothing, fishing rods, hockey equipment.

The tariffs, which do not qualify for preferential treatment under the US-Mexico-Canada free-trade agreement, open up some already vulnerable sectors to potential severe damage that could lead to job losses and business closures, trade experts have said.

The decision by the US administration followed three days of talks in Washington between Canada's minister for trade with the US, Dominic LeBlanc, and Greer.

The new duties add to existing US tariffs on steel, lumber and autos which have taken a major hit in the last 18 months, although the malaise has been largely contained within these sectors.

Bangladesh Bank (BB) has signed agreements with seven banks for participating in Tk 410 billion (Tk 41,000 crore) financing packages aimed at supporting productive and priority sectors of the economy.

The agreements were signed on Thursday at Bangladesh Bank headquarters in the presence of Deputy Governor Dr Md Kabir Ahmed, Executive Director Md Enamul Karim Khan and senior officials of the central bank and participating banks, said a press release.

The financing packages are part of a broader Tk 600 billion (Tk 60,000 crore) coordinated financing initiative designed to inject momentum into the economy, create employment, diversify exports and support productive sectors.

Of the Tk 410 billion (Tk 41,000 crore) fund, Tk 200 billion (Tk 20,000 crore) will be provided under a pre-financing scheme for supporting closed industries and the service sector, while Tk 50 billion (Tk 5,000 crore) will be allocated under a refinancing fund for the CMSME sector.

Another Tk 30 billion (Tk 3,000 crore) will be provided under a refinancing scheme to promote export diversification.

A further Tk 100 billion (Tk 10,000 crore) has been earmarked for agriculture and rural sectors to boost agricultural production, ensure food security and create employment.

Besides, Tk 30 billion (Tk 3,000 crore) will be provided under a refinancing scheme to create a special agriculture-based economic hub in northern Bangladesh.

The central bank said the financing initiative is intended to help maintain macroeconomic stability while supporting economic activities, investment and employment.

It also aims to ensure comparatively affordable financing through pre-financing and refinancing mechanisms.

The agreements were initially signed with Sonali Bank PLC, Bank Asia PLC, Eastern Bank PLC, City Bank PLC, Dutch-Bangla Bank PLC, Pubali Bank PLC and BRAC Bank PLC.

On behalf of Bangladesh Bank, Director of the Supervisory Data Management and Analytics Department Md Abdul Mannan signed the agreements, while managing directors of the participating banks signed on behalf of their respective institutions.

Deputy Governor Dr Md Kabir Ahmed highlighted the importance and multifaceted role of the Tk 410 billion (Tk 41,000 crore) fund at the signing ceremony.

Bangladesh Bank expects the participating banks to play an important role in channelling the funds to productive and priority sectors and in implementing the initiative effectively.

A meeting was held between the Bangladesh Securities and Exchange Commission (BSEC) and representatives of the World Bank Group to discuss the feasibility of establishing a Mortgage Refinance Company (MRC) in Bangladesh.

The meeting was held at the BSEC headquarters yesterday (19 August), according to a press release issued by the commission today.

The meeting discussed the proposed framework and role of a Mortgage Refinance Company in Bangladesh's housing finance sector.

The initiative aims to expand the country's housing finance sector while deepening the capital market.

Presided over by BSEC Chairman Masud Khan, the meeting was attended, among others, by BSEC Commissioners Tanwir Habib Rahman, Nahid Mahtab, Md. Nafeez Al Tarik, and Hossain Sadat. Representatives of the World Bank Group were also present at the meeting.

According to the press release, the meeting focused on detailed discussions about the potential institutional structure of the MRC and its role in developing housing finance.

Participants explored how the proposed entity could deepen the primary mortgage market by providing long-term refinancing facilities to financial institutions, enabling them to offer more accessible and longer-term mortgage loans.

The discussions also highlighted the MRC's potential role in mobilising capital market resources through instruments such as mortgage-backed securities, asset-backed securities and bonds.

The World Bank Group is currently conducting a feasibility study in response to a formal request from the Financial Institutions Division (FID) of the Ministry of Finance.

Based on the findings of the study, the relevant legal and regulatory frameworks will be formulated to facilitate the company's launch and operations.

In 2024, the government took the initiative to establish a Mortgage Refinance Company (MRC) to boost credit flows, unlock long-term investment and promote affordable housing.

Under the proposed structure, the MRC would operate under the direct supervision of Bangladesh Bank and raise capital through corporate bonds and mortgage-backed securities in the stock market.

The company would then use the funds to refinance banks and other lenders, enabling them to extend more mortgage loans to the housing sector.

Bangladeshi importers have suspended stone imports from India through Sonahat Land Port in Kurigram, protesting alleged substandard supplies, higher prices and reduced shipments by a syndicate of stone traders in Golakganj, Assam.

The indefinite suspension has brought port operations to a standstill since mid-July, leaving thousands dependent on port-related services without work and depriving the government of customs revenue.

Aminul Haque, assistant director (traffic) of Sonahat Land Port, said around 100 Indian trucks carrying stones normally enter the port each day, but imports have remained suspended amid a dispute between traders in the two countries.

“Sonahat Land Port earns more than Tk 4 crore in revenue on average every month. Not a single truck loaded with stone has arrived from India since July 18. As a result, no revenue has been generated,” he said.

Only stone is imported from India through the port, and export trade has not yet started, Aminul said.

Importers said Indian suppliers previously provided high-quality river stone boulders but are now sending smaller and lower-grade stones.

“We do not want to incur losses by importing substandard stones. Imports will remain suspended until quality products are supplied at reasonable prices,” said Abu Hena Masum, joint secretary of the Sonahat Land Port Importers and Exporters Association.

The stones fail to meet required size and quality standards after being processed through auto-crushing machines, making contractors involved in road, bridge and other infrastructure projects reluctant to buy them, he said.

Jahangir Alam Akmal, convener of the Sonahat Land Port Customs Clearing and Forwarding (C&F) Agents Association, said the influence of syndicates in India’s stone trade had increased.

Stone prices have also risen significantly, he said. River stones were previously imported at $11 per tonne, with the total landed cost in Bangladesh at about Tk 1,300 per tonne. The price has now increased to $13.5 per tonne, taking the import cost to around Tk 1,670 per tonne.

Jahangir also said stones were being loaded directly from quarries, resulting in excessive amounts of sand and soil being mixed with the shipments and increasing the risk of financial losses.

The suspension has left stone-crushing workers, loading and unloading labourers, truck drivers, transport workers and small traders in the area idle.

Soharab Hossain, a stone importer at Sonahat Land Port, said, “I had 700 tonnes of stone in stock, but all of it has already been sold. I do not have any stone left to sell. Although traders from different places have been contacting me to buy stone, I am unable to supply them.”

“When trucks loaded with stone arrive from India, the port remains busy and bustling with activity. But as no stone is coming now, the port almost seems haunted. I do not know when this deadlock will end,” he added.

Mofizul Islam, a loading and unloading worker at the port, said, “We have no work because no stones are arriving. We used to earn between Tk 700 and Tk 1,000 a day. Now we have to borrow money to support our families, and some workers are even taking high-interest loans.

“If this situation continues, we will be forced to look for other jobs.”

Another worker, Hamidul Islam, said more than 3,000 labourers were directly involved in stone unloading, crushing and related activities at the port. With imports suspended, all crushing machines have stopped operating, leaving most workers unemployed.

Truck driver Mizanur Rahman said transporting imported stones used to be his primary source of income. “Now the trucks remain idle, and our earnings have dropped sharply,” he said.

Traders and officials remain hopeful that the dispute will be resolved, although they are unsure when.

“We hope operations will return to normal once the problem is resolved,” the port’s assistant director Aminul said.

“It is not possible to say for certain when the deadlock at the land port will end. However, local traders at the port are maintaining regular communication with their Indian counterparts.”

“Discussions are underway between traders from both countries, and imports will resume once the issue is resolved,” Jahangir Alam Akmal said.

The government has waived more than half of the total tax incidence on server imports to promote cloud infrastructure and data centre development amid growing adoption of artificial intelligence.

The National Board of Revenue (NBR) issued a gazette notification on August 17, making the concession effective immediately.

Currently, the total tax incidence on server imports is nearly 24 percent. Following the notification, the rate has been reduced to 9.5 percent, including 7.5 percent advance tax, said a tax official, seeking anonymity.

The move follows stakeholders’ negotiations with the government during the budget session for 2026-27, the official added.

The decision is expected to reduce the cost of server imports and support the expansion of digital infrastructure for businesses and organisations.

According to the NBR notification, the exemption applies to servers imported under HS Code 8471.50.90.

The notification said importers of the specified servers would be exempted from customs duty, regulatory duty, supplementary duty, if applicable, and value-added tax (VAT) as specified in the first schedule of the Customs Act.

The concession comes as demand for computing capacity and data infrastructure is rising with the growth of digital services and technology-driven businesses in Bangladesh.

“As we promised, we are committed to reducing the total cost of servers, as this will support the development of data centres and cloud infrastructure. These facilities will also play a critical role in accelerating artificial intelligence adoption in our country,” said Rehan Asad, telecom and ICT adviser to the prime minister.

Industry stakeholders welcomed the move.

“I think it is a positive move. In the budget, similar benefits were provided for imported laptops, which will help expand digitisation,” said AKM Fahim Mashroor, former president of the Bangladesh Association of Software and Information Services (BASIS).

“However, import duty on smartphones remains very high, resulting in low smartphone penetration,” he said.

“Smartphones are now the primary digital access devices for most people. Therefore, they should be treated in the same way as laptops and servers,” he added.

LNG supply from the Excelerate Energy-operated floating storage and regasification unit (FSRU) at Maheshkhali stopped this afternoon (19 August) as the terminal ran out of LNG, further worsening Bangladesh's gas crisis.

Several Petrobangla and Energy Division sources told The Business Standard that the terminal stopped supplying gas to the national grid around 3pm due to a shortage of fresh LNG cargo.

With Excelerate offline, national gas supply fell to around 2,185 million cubic feet (mmcf) a day, leaving an average shortfall of about 500 mmcf.

At around 8pm, LNG-based gas supply stood at 561 mmcf, all of it from Summit's FSRU, now the country's only operating LNG terminal. The remaining 1,624 mmcf came from domestic gas fields.

The latest disruption came just four days after Excelerate resumed partial operations following a 25-day shutdown caused by a fire on 21 July. The terminal had gradually cut supply since Monday as its remaining LNG stock dwindled.

Bangladesh has two FSRUs at Maheshkhali – Excelerate's terminal has a regasification capacity of 600 mmcf a day, while Summit's can handle 500 mmcf.

No fresh cargoes in pipeline

Petrobangla oversees LNG imports with approval from the Energy Division, while its subsidiary Rupantarita Prakritik Gas Company Limited (RPGCL) handles procurement.

Sources at Petrobangla and RPGCL said several LNG cargoes had been procured through direct purchases outside the regular procurement process to secure supplies at lower prices. Four such cargoes were scheduled to arrive this month, but none have arrived yet.

As a result, Excelerate's terminal, despite being operationally ready, has been unable to resume supply.

An LNG cargo is expected to arrive tomorrow and may be connected to Summit's terminal. A source said a cargo for Excelerate could arrive on 23-24 August, meaning the terminal may remain out of operation for several more days.

The latest shutdown reduced LNG-based gas supply from around 660 mmcf on Tuesday to about 550-561 mmcf today, while total national supply fell to roughly 2,180-2,185 mmcf.

The Bangladesh Bank has allowed state-owned Rupali Bank to release nearly $3.2 million in remaining syndicated foreign-currency loans and open a new letter of credit (LC) for SS Power-1 Limited, a power plant owned by the controversial S Alam Group.

The central bank issued the instruction today (19 August), granting the exemption under Section 121 of the Bank Company Act, 1991. The directive was sent to all banks in the country.

According to the Bangladesh Bank circular, Rupali Bank has been authorised to release $ $3,197,561.28 from the remaining portion of the syndicated foreign-currency loan approved for SS Power-1 and open an import LC for the company.

The central bank has also exempted the facility from the provisions of Section 27Ka(3) of the Bank Company Act, which restricts banks from providing certain facilities to loan-defaulter companies.

The latest approval follows another Bangladesh Bank directive issued on 16 August, which allowed Rupali Bank to open import LCs for SS Power-1 against a 100% cash margin. The facility is set to remain in force until December 2027.

However, Bangladesh Bank imposed a specific condition on the latest facility.

The central bank said it would bear no liability arising from the loan facility, while Rupali Bank would not be allowed to seek any financial assistance from Bangladesh Bank in the future in connection with it.

According to Bangladesh Bank officials, SS Power-1 is currently operational and supplying electricity to the national grid. A shortage of raw materials could disrupt generation, prompting the central bank to allow the company to open LCs despite its status as a loan defaulter. Similar facilities have previously been provided to companies to keep production and employment running.

SS Power-1 operates a 1,320MW coal-fired power plant in Gandamara of Banshkhali, Chattogram. The plant was built as a joint venture between S Alam Group and two Chinese companies, with its two units each having a generation capacity of 660MW.

The plant began commercial generation in September 2023 and supplies electricity to the national grid.

S Alam Group owns 70% of SS Power-1, while China's SEPCO III and HTG Development Group hold the remaining 30%.

The Bangladesh Bank data shows loans taken by various S Alam Group entities, both directly and through other entities, exceed Tk2.25 lakh crore, with a significant portion already classified as defaulted.

The Dhaka Stock Exchange (DSE) has issued a fresh list of 138 marginable securities, providing a clear roadmap for investors and brokerage houses under the newly implemented regulatory framework.

The updated list, which details the companies qualifying for credit facilities, follows the recent gazette notification of the "Bangladesh Securities and Exchange Commission (Margin) Rules, 2025." This overhaul is aimed at boosting market liquidity and restoring investor appetite by providing more flexibility in leverage-based trading. Among the 138 firms, eight are from B category.
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Under the revised rules, shares of listed companies in the 'A' and 'B' categories are now eligible for margin loans if their price-to-earnings (P/E) ratio remains within 40. This is a significant shift from previous restrictions, allowing a broader range of fundamentally sound companies to be traded with borrowed funds.

Furthermore, the regulator has addressed specific concerns in the insurance sector by raising the maximum allowable price-to-book (P/B) ratio for life insurers to 3, a significant jump from the initially proposed limit of 1. This ratio is calculated by dividing the latest closing price by the audited net asset value per share.

The newly released list is dominated by the market's most robust entities. Telecommunication giants Grameenphone and Robi Axiata, along with blue-chip manufacturing and consumer firms like British American Tobacco, Walton Hi-Tech, and Berger Paints, are prominent features. The pharmaceutical sector also maintains a heavy presence with market leaders such as Square Pharma, Beximco Pharma, Renata, and IBN SINA included in the marginable bracket.

Leading commercial lenders, including BRAC Bank, City Bank, Eastern Bank, Dutch-Bangla Bank, and Pubali Bank, continue to be staples for margin investors, alongside top-tier non-bank financial institutions like IDLC and IPDC Finance.

In the energy segment, investors can avail of loans for state-owned fuel distributors like Padma, Jamuna, and Meghna Petroleum, as well as United Power and MJL Bangladesh. The list further encompasses major players in the steel and cement sectors, such as BSRM Steels and LafargeHolcim, as well as technology firms like ADN Telecom and Genex Infosys.

However, the BSEC has maintained a cautious approach regarding riskier segments of the market. Securities categorised under 'Z' (junk stocks), 'N' (newly listed), and 'G' (greenfield) remain strictly excluded from margin facilities. Additionally, shares traded on the SME board, Alternative Trading Board (ATB), and the Over-the-Counter (OTC) platforms do not qualify for credit due to their relatively higher risk profiles and lower liquidity.

NCC Bank is set to scale up its Shariah-compliant operations after receiving in-principle approval from Bangladesh Bank to convert 20 of its conventional branches into full-fledged Islamic banking units.

According to a price-sensitive disclosure filed with the Dhaka Stock Exchange today (19 August), the central bank communicated its approval through a letter dated 17 August 2026.

The bank stated that the conversion process will be carried out in strict accordance with the "Guidelines for Conversion of a Conventional Bank to an Islamic Bank" and other relevant regulatory frameworks issued by the central bank.
Currently, NCC Bank operates a very limited Islamic banking network, with only four dedicated branches in Dhaka, Chattogram, Feni, and Thakurgaon. The addition of 20 more branches represents a fivefold expansion of its dedicated Shariah-based service points, reflecting the growing demand for Islamic financial products in the country.

Despite the news of a strategic expansion, the bank's shares saw a marginal correction on the premier bourse. NCC Bank's share price edged down by 0.65% to settle at Tk15.20 today.

Meanwhile, the lender reported a consolidated earnings per share of Tk2.08 in the first half of 2026, marking a 12% growth from Tk1.86 in the corresponding period of 2025.

The bank attributed the rise in profitability primarily to an increase in investment income and the recovery of provisions previously kept against shares.

At the end of June 2026, the bank's consolidated Net Asset Value per share stood at Tk26.39, up from Tk26.15 in December 2025.

However, the bank's cash flow position witnessed a decline. The consolidated net operating cash flow per share dropped to Tk6.68 for the first six months of 2026, compared to Tk10.96 in the previous year.

The bank explained that the decline in cash flow was due to a surge in the purchase of government securities for trading, higher loan disbursements, and advance payments for office rents during the reporting period.

The government has set out a five-year plan to clean up the banking sector, with a focus on recovering bad loans, tightening supervision, improving governance and restoring depositor confidence.

The plan comes as banks grapple with record non-performing loans (NPLs), weak governance, political interference and lending to politically connected businesses. These problems have eroded both capital and profitability of many banks, with state-owned lenders particularly exposed.

By December last year, NPLs in the country’s banking sector reached Tk 5.57 lakh crore, equivalent to 30.6 percent of total loans, according to official data.

Over the same period, banks’ return on equity fell from 9.42 percent in 2016 to minus 16.11 percent in 2025.

The five-year framework, titled “Five-Year Strategic Framework for Reform and Development (July 2026-June 2031)”, was prepared by the General Economics Division of the Planning Ministry and approved by the National Economic Council on May 18. It was released yesterday.

The government will roll out the reforms in three overlapping phases.

Those are containing immediate risks in the first year, rebuilding banks over the next two years and pursuing deeper reforms in years three to five.

FIRST YEAR: CONTAIN THE DAMAGE

The first year will focus on high-risk banks, bad loans and depositor protection.

Operational autonomy of the Bangladesh Bank will be enforced on an interim basis, while high-risk banks will face stricter supervision and regulatory action.

The central bank will identify willful defaulters and take legal action against them. It will also enforce stricter loan classification and provisioning rules to prevent bad loans from piling up.

The government will apply fit-and-proper criteria to bank boards and senior management and restructure boards that fail to meet the requirements.

The Deposit Protection Fund will be made operational. The government will strengthen the capital position of merged banks and begin reimbursing depositors, while interim arrangements will be introduced to repay depositors of distressed banks.

The immediate priority will be to enforce rules, address governance failures, recover bad loans, protect depositors and maintain liquidity.

NEXT, REBUILDING BANKS

Over the next two years, the government plans to strengthen governance, risk management and loan recovery while building stronger financial safety nets.

The central bank will receive full operational autonomy, with risk-based supervision and stress testing introduced.

Loan rescheduling will be tightened, large borrowers will face closer monitoring, and banks will have to comply more strictly with lending rules. Board appointment procedures will also be standardised, with limits on board tenure and family representation.

Banks will have to disclose financial data at the individual bank level and follow reporting standards aligned with Basel III -- a global regulatory framework.

DEEPER REFORMS IN FINAL PHASE

The final phase will focus on making banks more efficient and competitive while reducing risks to the wider financial system.

The plan calls for stronger governance, greater transparency, better data systems and stronger supervisory capacity at the Bangladesh Bank. Legal and institutional changes will also be introduced to strengthen its operational independence and bring regulations closer to international standards.

The government plans to improve the recovery of bad loans through specialised financial tribunals, stronger legal enforcement and faster resolution mechanisms.

The plan also proposes a fully functioning deposit protection system, including the pay-box model, to protect depositors and strengthen market discipline.

BANKS MUST FIX THEIR BALANCE SHEETS

The framework makes clear that simply increasing credit will not solve the banking sector’s problems.

Banks must first repair their balance sheets through restructuring, disciplined write-offs and faster recovery of defaulted loans. Then they can expand lending safely to small and medium-sized enterprises, agriculture and productive industries.

The plan also identifies political interference as a major problem.

Weak board oversight, preferential lending and limited accountability have contributed to poor risk management and the buildup of bad loans, it says.

WHO WILL OVERSEE THE REFORMS?

The Bangladesh Bank will lead regulatory and supervisory reforms, while the Financial Institutions Division will coordinate legal and policy changes involving state-owned banks and other government-owned financial institutions.

Progress will be measured against indicators covering capital adequacy, asset quality, liquidity, governance, depositor confidence and transparency.

The central bank will conduct annual reviews, with a mid-term assessment in FY2028 to measure progress and recommend changes.

The government says the reforms are urgent as Bangladesh prepares for LDC graduation, which could reduce access to concessional financing and external liquidity support and increase reliance on the domestic financial system.

The bigger challenge, however, will be implementation.

On July 21, a fire during a ship-to-ship transfer damaged the cabling on one boiler aboard a leased floating terminal off Moheshkhali. That fault removed 450 million cubic feet of gas per day from the grid. Within a fortnight, load shedding was averaging 3,000 megawatts, and CNG queues ran three rows deep.

Commentary has rerun a familiar argument: too little exploration on one side, an unaffordable import bill on the other. Both points have merit, but neither explains why one boiler could do this much damage. It could, because Bangladesh’s entire imported-gas channel floats on two ships. Both were disconnected during Cyclone Mocha in 2023. Cyclone Remal damaged one in 2024, cutting capacity for nearly four months. The July fire is the third systemic outage in four years. The binding constraint is not the molecule; it is the infrastructure that lands it.

The official response has been fast and floating. On July 28, the cabinet committee approved in principle a third FSRU at Kutubjom under a government-to-government arrangement, adding 600 million cubic feet per day, and, by expert estimates, for three to four years. A third ship, built by a Chinese contractor, adds capacity in the same fragile form, exposed to cyclones and single-vessel risk. Floating units were chosen to avoid capital spending. That saving has been repaid several times over in spot cargoes above $21 per million British thermal units and idled factories: the country has paid for a fixed terminal without owning one.

The land-based terminal at Matarbari, discussed since 2014, would bring storage measured in days rather than hours, but the complex and pipeline are the better part of a decade away. The stronger candidate is the gravity-based structure: a concrete terminal resting on the seabed, LNG tanks built inside it, offering the resilience of a fixed terminal in less time. Italy has operated one fifteen kilometres offshore since 2009, supplying 14 percent of Italian gas, financed privately against a 25-year capacity contract. Starting now, a GBS could be delivering gas within this government term. Whether the Bay of Bengal seabed and cyclone loading suit it is a question for engineers. Whether it belongs in the Matarbari feasibility study is not.

Pakistan built its first LNG terminal at Port Qasim for $125 million in 332 days, with debt from the IFC and the Asian Development Bank and a capacity fee from the state gas utility. Tolling is not exotic here; it is how both existing Moheshkhali terminals are already remunerated.

I have arranged investor funding for concentrated gas assets in Europe and the Middle East, where offtake is contractual, and structures are clean. The same could be done for Bangladesh. The World Bank has committed $700 million to guarantee Petrobangla’s LNG import payments through letters of credit and short-term credit lines. That is procurement support, not construction finance. The same guarantee logic, already used for Bangladeshi power projects, can be pointed at terminal steel rather than cargo invoices.

Petrobangla has already invited transaction advisers for the Matarbari land-based terminal; submissions closed on August 10. The structuring choice sits with the Energy and Mineral Resources Division, which could set terms for a project-financed, build-own-operate-transfer structure with take-or-pay tolling and multilateral credit enhancement, with a gravity-based option costed alongside the onshore design. A terminal financed that way costs the exchequer little. The past weeks have shown what the floating alternative costs.