Bangladesh Bank Governor Dr Atiur Rahman, speaks at a seminar on ‘Financial Integrity: Managing Operational Risks and Avoiding Serious Losses at the Branch Level’ at City In Hotel at Shibbarhi in Khulna Sunday.

Bangladesh Bank Governor Dr Atiur Rahman urged the officials of the central bank to tighten supervision on corporate governance, internal audit, internal controls, and external audit in lowering the risk and discouraging repetition of fraudulence.

The central bank has to go forward with firmness and promptness and every bank and Bangladesh Bank have to keep watch so that none can escape by committing any fraud, he said.

The BB chief made the observations while speaking at a seminar on “Financial Integrity: Managing Operational Risks and Avoiding Serious Losses at the Branch Level” at City In Hotel at Shibbarhi in Khulna Sunday. Bangladesh Bank, Khulna, organised the seminar.

Atiur said the central bank has undertaken several reforms and redesign actions for its financial sector supervision framework in order to ensure sound growth of the country’s banking sector.

“As part of it, the BB has instituted quick inspection and formulation of a review report on activities and various issues of financial statement analysis of the banks, and also made two separate departments out of the previous foreign exchange inspection and vigilance department,” he added.

The central bank has been setting up an Electronic Dash Board in order to identify the trends that might indicate irregularities and fraudulence from the data and information of the financial statements of the banks collected by the BB’s supervision departments, the BB Chief said.

Atiur said proper directives have been given to the banks for submitting all information regarding export-import including IBP on-line to BB, as well as to adopt IT-based system.

The IT department of BB has also undertaken initiatives to prepare suitable software for the bank. Besides, the banks have been asked to prepare fraud risk assessment worksheets on quarterly basis. The banks to make self-assessment through the worksheets that has more than 50 assessment criteria, said Dr Atiur.

Bangladesh Bank has appointed the National Fraud Risk Detection and Risk Mitigation Adviser who, with the help of the related departments, will detect the limitations of existing policies, strategies, and guidelines of BB, determine the adequacy of the information sent by the commercial banks, and prepare recommendations on future actions along with providing training programme for the selected Bangladesh Bank Staff, said Dr Atiur.

In the Khulna and Barisal divisions, there are more than 1,200 branches of the scheduled banks, or about 15 percent of the total branches in Bangladesh. Overall, these branches manage about Tk 200 billion in loans and advances and about T. 260 billion in deposits, which represents only 6 percent of the total activity in the banking sector, BB chief mentioned.

He asked BB officials to check whether these branches are following the right procedures in handling the deposits of the people of the region.

Less attention from the head office, due to lower transactions and greater physical distance, fewer face-to-face meetings between branch managers and executive management in Dhaka, and other factors could expose these branches to a higher risk of internal and external fraud. Thus, we have to keep our keen/watchful eye on it.

News: The Daily Sun/Bangladesh/12-Nov-12