Bangladesh Bank

Bangladesh Bank (Bengali: বাংলাদেশ ব্যাংক) is the central

bank of Bangladesh and is a member of the Asian Clearing Bangladesh Bank

Union. It is fully owned by the Government of Bangladesh. বাংলাদেশ ব্যাংক

The bank is active in developing green banking[4] and financial

inclusion policy and is an important member of the Alliance
for Financial Inclusion.[5] Bangladesh Financial Intelligence
Unit (BFIU), a department of Bangladesh Bank, has got the
membership of Egmont Group of Financial Intelligence Units.

Bangladesh Bank is the first central bank in the world to

introduce a dedicated hotline (16236) for people to complain
about any banking-related problem.[6] Moreover, the
organisation is the first central bank in the world to issue a
"Green Banking Policy". To acknowledge this contribution,
then-governor Dr. Atiur Rahman was given the title 'Green Bangladesh Bank Monogram
Governor' at the 2012 United Nations Climate Change Headquarters Dhaka,
Conference, held at the Qatar National Convention Centre in Bangladesh
Doha.
Established 16 December
1971
Ownership 100% state
Contents ownership[1]
History Governor Fazle Kabir[2]
Branch offices Central bank of Bangladesh
Functions Currency Taka (৳)

Organisation JBJ (ISO 4217)

Hierarchy Reserves ৳3400 billion
Board of directors (US$40 billion)
Publications of Bangladesh Bank Bank rate 4%[3]
Governors Website www.bb.org.bd (ht
Bangladesh Bank Award tp://www.bb.org.b
d)
See also
reserves data up to month of Aug 2015.

References
source: "Bangladesh's forex reserves cross
External links record $26 billion mark" (https://web.archiv
e.org/web/20150910175515/http://bdnews2

History 4.com/economy/2015/08/17/bangladeshs-f
orex-reserves-cross-record-26-billion-
mark). bdnews24.com. bdnews24.com. 17
On 7 April 1972, after the Independence War and the eventual
August 2015. Archived from the original (htt
independence of Bangladesh, the Government of Bangladesh
p://bdnews24.com/economy/2015/08/17/ba
passed the Bangladesh Bank Order , 1972 (P.O. No. 127 of
1972), reorganising the Dhaka branch of the State Bank of ngladeshs-forex-reserves-cross-record-26-
Pakistan as Bangladesh Bank, the country's central bank and billion-mark) on 10 September 2015.
apex regulatory body for the country's monetary and financial
system.[7]

The 1972 Mujib government pursued a pro-socialist agenda. In

1972, the government decided to nationalise all banks to
channel funds to the public sector and to prioritise credit to
those sectors that sought to reconstruct the war-torn country –
mainly industry and agriculture.[8] However, government Bangladesh Bank Building in
control of the wrong sectors prevented these banks from Motijheel commercial area, Dhaka
functioning well. This was compounded by the fact that loans
were handed out to the public sector without commercial
considerations; banks had poor capital lease, provided poor customer service and lacked all
market-based monetary instruments. Because loans were given out without commercial
considerations, and because they took a long time to call a non-performing loan, and once they
did, recovery under the erstwhile judicial system was so expensive, loan recovery was abysmally
poor.[8][9] While the government made a point of intervening everywhere, it did not set up a
proper regulatory system to diagnose such problems and correct them. Hence, banking concepts
like profitability and liquidity were alien to bank managers, and capital adequacy took a
backseat.[9]

In 1982, the first reform program was initiated, wherein the government denationalised two of the
six nationalised commercial banks and permitted private local banks to compete in the banking
sector. In 1986, a National Commission on Money, Banking and Credit was appointed[9] to deal
with the problems of the banking sector, and a number of steps were taken for the recovery targets
for the nationalised commercial banks and development financial institutions and prohibiting
defaulters from getting new loans. Yet the efficiency of the banking sector could not be
improved.[8]

The Financial Sector Adjustment Credit (FSAC) and Financial Sector Reform Programme (FSRP)
were formed in 1990, upon contracts with the World Bank. These programs sought to remove
government distortions and lessen the financial repression.[9] Policies made use of the McKinnon-
Shaw hypothesis, which stated that removing distortions augments efficiency in the credit market
and increases competition.[8] The policies therefore involved banks providing loans on a
commercial basis, enhancing bank efficiency and limiting government control to monetary policy
only. FSRP forced banks to have a minimum capital adequacy, to systematically classify loans and
to implement modern computerised systems, including those that handle accounting. It forced the
central bank to free up interest rates, revise financial laws and increase supervision in the credit
market. The government also developed the capital market, which was also performing poorly.

FSRP expired in 1996. Afterwards, the Government of Bangladesh formed a Bank Reform
Committee (BRC), whose recommendations were largely unaddressed by the then-government.

At present it has ten offices located at Motijheel, Sadarghat, Chittagong, Khulna, Bogra, Rajshahi,
Sylhet, Barisal, Rangpur and Mymensingh in Bangladesh; total manpower stood at 5807 (officials
3981, subordinate staff 1826) as of 31 March 2015.

Branch offices
1. Motijheel 6. Barishal
2. Sadarghat 7. Khulna
3. Bogura 8. Sylhet
4. Chattogram 9. Rangpur
5. Rajshahi 10. Mymensingh
Functions
The Bangladesh Bank performs all the functions that a central bank in any country is expected to
perform. Such functions include maintaining price stability through economic and monetary
policy measures, managing the country's foreign exchange and gold reserve, and regulating the
banking sector of the country. Like all other central banks, Bangladesh Bank is both the
government's banker and the banker's bank, a "lender of last resort". Bangladesh Bank, like most
other central banks, exercises a monopoly over the issue of currency and banknotes. Except for the
one, two, and five taka notes and coins which are the responsibility of the Ministry of Finance of
the Government of Bangladesh.
The major functional areas include :

Formulation and implementation of monetary and credit policies.

Regulation and supervision of banks and non-bank financial institutions, promotion and
development of domestic financial markets.
Management of the country's international reserves.
Issuance of currency notes.
Regulation and supervision of the payment system.
Acting as banker to the government .
Money laundering prevention.
Collection and furnishing of credit information.
Implementation of the Foreign Exchange Regulation Act.
Managing a deposit insurance scheme .

Organisation
The bank's highest official is the governor (currently Fazle Kabir). His seat is in Motijheel, Dhaka.
The governor chairs the board of directors. The executive staff, also headed by the governor, is
responsible for the bank's day-to-day affairs.

Bangladesh Bank also has a number of departments under it, namely Debt Management, Law, and
so on, each headed by one or more general managers.[10] The Bank has 10 physical branches:
Mymensingh, Motijheel, Sadarghat, Barisal, Khulna, Sylhet, Bogra, Rajshahi, Rangpur and
Chittagong; each is headed by an executive director. Headquarters are located in the Bangladesh
Bank Building in Motijheel, which has two general managers.

Hierarchy

The executive staff is responsible for daily affairs, and includes the governor and four deputy
governors. Under the governors, there are executive directors and an economic advisor.[11]

The general managers of the departments come under the executive directors, and are not part of
the executive staff.[11]

The Four deputy governors are:

Ahmed Jamal,
Kazi Sayedur Rahman,
A.K.M. Sajedur Rahman Khan and
Abu Farah Md. Nasser
.[12]

Board of directors
The board of directors consists of the bank's governor and eight other members. They are
responsible for the policies undertaken by the bank.

Publications of Bangladesh Bank

Bangladesh Bank publishes a range of periodical publications, research papers, and reports that
contain monetary and banking developments, economic reviews, as well as various other statistical
data. These include:

Annual Report
Bangladesh Bank Quarterly
Monetary Policy Review
CSR Initiatives in Banks
BBTA Journal : Thoughts on Banking and Finance
Annual Report on Green Banking
Import Payments
Financial Stability Assessment Report

Governors
Since its conception, the Bangladesh Bank has had 11 governors:[13]

A.N.M. Hamidullah (18 January 1972 – 18 November 1974)

A.K. Naziruddin Ahmed (19 November 1974 – 13 July 1976)
M. Nurul Islam (13 July 1976 – 12 April 1987)
Shegufta Bakht Chaudhuri (12 April 1987 – 19 December 1992)
Khorshed Alam (20 December 1992 – 21 November 1996)
Lutfar Rahman Sarkar (21 November 1996 – 21 November 1998)
Mohammed Farashuddin (24 November 1998 – 22 November 2001)
Fakhruddin Ahmed (29 November 2001 – 30 April 2005)
Salehuddin Ahmed (1 May 2005 – 30 April 2009)
Atiur Rahman (1 May 2009 – 15 March 2016)
Fazle Kabir (20 March 2016 – present)

Bangladesh Bank Award

Bangladesh Bank Award is introduced in 2000.[14]
The winners are:

1. Rehman Sobhan (2000)[15]

2. Nurul Islam (2009)[15]
3. Mosharraf Hossain (2011)[16]
4. Muzaffar Ahmed and Swadesh Ranjan Bose (2013)[14]
5. Azizur Rahman Khan and Mahbub Hossain (2017)[17]

See also
Bangladesh Bank Taka Museum
Bangladesh Bank robbery
 Economy of Bangladesh

References
1. Weidner, Jan (2017). "The Organisation and Structure of Central Banks" (https://d-nb.info/1138
787981/34) (PDF). Katalog der Deutschen Nationalbibliothek.
2. "Former finance secretary Fazle Kabir to head Bangladesh Bank, says Minister Muhith" (http://
bdnews24.com/economy/2016/03/15/former-finance-secretary-fazle-kabir-to-head-bangladesh
-bank-says-minister-muhith). bdnews24.com.
3. "Interest rates (Monthly)" (https://www.bb.org.bd/econdata/intrate.php). Bangladesh Bank.
Retrieved 27 July 2019.
4. "Green Banking in Bangladesh" (https://web.archive.org/web/20140416184055/http://www.ban
gladesh-bank.org/pub/special/greenbankingbd.pdf) (PDF). Bangladesh Bank. November 2012.
Archived from the original (http://www.bangladesh-bank.org/pub/special/greenbankingbd.pdf)
(PDF) on 16 April 2014.
5. "AFI Member Institutions" (https://web.archive.org/web/20120822075823/http://www.afi-global.
org/afi-network/members), Alliance for Financial Inclusion, archived from the original (http://ww
w.afi-global.org/afi-network/members) on 22 August 2012
6. "COMPLAINTS FORM" (https://cms.bb.org.bd/ords/f?p=107:133:). cms.bb.org.bd. Retrieved
24 February 2021.
7. The Bangladesh Bank Order, 1972 (President's Order) ( PRESIDENT'S ORDER NO. 127 OF
1972 ) (http://bdlaws.minlaw.gov.bd/act-details-415.html?lang=bn) bdlaws.minlaw.gov.bd.
Retrieved 11 September 2021
8. Bahar, Habibullah (9 December 2009). Financial Liberalization and Reforms in Bangladesh.
National Workshop on "Strengthening the Response to the Global Financial Crisis in Bhutan:
The Role of Monetary, Fiscal and External Debt Policies". Thimphu, Bhutan:
UNESCAP/UNDP/Royal Monetary Authority of Bhutan.
9. Bhattacharya, Debopriyo; Toufic A Chowdhury (April 2003). "Financial Sector Reforms in
Bangladesh: The Next Round". CPD Occasional Paper Series. Paper 22. Dhaka, Bangladesh:
Centre for Policy Dialogue. Paper 22.
10. "General Managers" (http://www.bb.org.bd/aboutus/gm.php). Bangladesh Bank. Retrieved
15 August 2011.
11. "BB Hierarchy" (http://www.bb.org.bd/aboutus/bbhierarchy.php). Bangladesh Bank. Retrieved
14 March 2021.
12. "Deputy Governors" (http://www.bb.org.bd/aboutus/deputygovernor.php). Bangladesh Bank.
Retrieved 14 March 2021.
13. "Governors of BB" (https://web.archive.org/web/20150523145036/http://www.bangladesh-ban
k.org/aboutus/bbgovernors.php). bangladesh-bank.org. Archived from the original (http://www.
bangladesh-bank.org/aboutus/bbgovernors.php) on 23 May 2015. Retrieved 7 June 2012.
14. "BB awards two economists posthumously" (https://www.thedailystar.net/bb-awards-two-econo
mists-posthumously-37988). The Daily Star. 21 August 2014. Retrieved 2 June 2018.
15. "Economist digs deep into rich-poor gap" (https://www.thedailystar.net/news-detail-132477).
The Daily Star. 1 April 2010. Retrieved 2 June 2018.
16. "Muzaffer, Swadesh to get BB Award" (http://en.prothomalo.com/bangladesh/news/51832/মান
বতাবিরোধীরা-নির্বাচনের-অযোগ্য). Prothom Alo. 10 August 2014. Retrieved 2 June 2018.
17. "Central Bank gives BB Award to Azizur Rahman, Mahbub Hossain" (http://www.newagebd.ne
t/article/35072/article/articlelist/323/Cartoon). New Age. Retrieved 2 June 2018.

External links
Banks Information BD (https://banksinfobd.com/) All Banks information in Bangladesh
Retrieved from "https://en.wikipedia.org/w/index.php?title=Bangladesh_Bank&oldid=1068855472"

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