First Security Islami Bank sponsored children’s science congress at National Museum of Science and Technology at Agargaon in Dhaka recently.

Md. Humayun Kabir Khan, General Manager, National Museum of Science and Technology presided over the programme, said a press release.

Banking sector showed rising capital strength with a weighted average core capital adequacy ratio of 10.68 percent at the end of June.

The level of capital adequacy was well above the 8.0 percent risk-weighted assets, stipulated in the Basel-II regulations.

The latest Bangladesh Bank (BB) data showed the capital requirement that banks should maintain as a regulatory obligation was Taka 63,694 crore or 10.68 percent of their total capital at the end of June this year.

The amount of the risk-weighted assets rose by 138 percent in the past five years, demonstrating a strong fundamental and low risk of the country’s banking sector, a BB official told BSS.

He said the amount of the risk-weighted assets was Taka 26,713 crore in 2009 when the central bank adopted the Base-II regulations, a global standard that banks should follow to maintain a certain level of cash reserve to fence off operational risk factors.

“The higher cash reserve reflects the higher capacity of banks to absorb shocks from operational and other losses,” the official said.

The higher capital adequacy of banks has been attributed to the prudent policy support, strict monitoring and effective training of staff of the central bank as well as commercial and specialized banks.

Cutting the time limit for classifying bad loans from six months to three months also helped a lot to bring down the amount of bad loan, which eventually strengthened the capital base.

“The banking sector also posted a stable performance in the past few years, with the non-performing loan ratio capped at a relatively low level,” the BB official said. 

The instructions came at an orientation meeting that Bangladesh Bank held with the BASIC Bank board of directors yesterday at its headquarters in the capital

The banks yesterday sent letters to the Division seeking its representatives for three-member committees

The country’s banking sector can contribute to the country’s inclusive development in a greater way if it could be made competitive, effective and transparent, removing the existing problems, said leading economists. “The prevailing problems are identified. Necessary steps need to be taken to remove the problems as quickly as possible to ensure banking sector’s better contribution to development process,” Director General of the Bangladesh Institute of Development Studies (BIDS), Mustafa K Mujeri, told UNB. Evaluating the overall situation in the banking sector, Mujeri said he does want to term the current situation a ‘crisis’ but acknowledged problems like increase in non-performing loans and problems relating to credit disbursement, reports the news agency. Acknowledging it, AB Mirza Azizul Islam said the situation in the banking sector is not that much satisfactory with the increase in classified loans, slower economic activities and lower demand for credit.Mirza Aziz, a former caretaker government adviser, however, said there is no such situation for which one can claim that the banking system is going to collapse. On recent scams in the sector, Mujeri said the government and the central bank have taken a number of initiatives to overcome the situation but most of the steps are yet to be implemented.Expressing dismay over the delay in punishing the offenders, Mujeri said, “This doesn’t give the right signal, it rather creates confusions and suspicions among people.”“Others will get a massage that nobody will be spared if the responsible persons are punished timely and quickly for their wrongdoings. But if there is any delay, people will get prompted to repeat the offence,” said the economist.Mujeri thinks proper punishment for those who are found guilty will have to be ensured very quickly if the government and the central bank want to restore discipline in the banking sector.Responding to a query, Mirza Aziz said the steps taken so far relating to scams are not enough. “I don’t think these are enough.”On Sonali Bank’s scam, he said no remarkable step was taken over the bank board though the Bangladesh Bank clearly mentioned the board also had responsibility to that end.Mirza Aziz, however, said the irregularities that took place are past now, and hoped there would be no repetition of such irregularities.The central bank has said it is alert and strengthened its supervision and inspection systems.About the formation of banks’ governing bodies, Mujeri said the board is highest policymaking body of a bank where experienced people with adequate knowledge on bank management and its operations must be there to run it efficiently.“It’s not important whether the person is political or non-political one. But he must be experienced and must have clear idea about the operation of a bank and capability to contribute to the bank positively.But it won’t be wise for the bank if someone gets appointed only under political consideration,” he added.