Biz-Econ

No need to panic about bank deposits: BB

Bangladesh Bank Executive Director and Spokesperson Husnay Ara Shikha reassured the people on Wednesday that there is no reason to panic about customer deposits in banks. 

Speaking at a press conference, she said that while some customers are withdrawing their money, mass withdrawals could create problems, as no bank in the world could meet such demands all at once.

She emphasised, "There is no need to panic about your deposits. Everyone will get their money back." If large numbers of customers try to withdraw money simultaneously, it would create an unsustainable situation for any bank globally. She urged the public to avoid unnecessary panic, she explained adding that the media plays a crucial role in alleviating fears and promoting confidence.

Husnay Ara Shikha also outlined Bangladesh Bank’s plans to improve the banking sector. "We ask depositors not to withdraw more money than necessary. Our goal is to restore confidence in the banking system," she said. 

Bangladesh Bank has provided support of Tk 5,585 crore to banks facing crises over the last month and a half.

Regarding the appointment of receivers in institutions, she clarified that Bangladesh Bank would not take such actions independently. Receivers would only be appointed following a court order. 

She also addressed concerns about money laundering, stating that the central bank investigates cases where funds are smuggled through formal channels. 

However, detecting money laundering through informal channels, such as hundi, remains a challenge, though the Bangladesh Financial Intelligence Unit (BFIU) is working diligently on these cases.

On the issue of loan irregularities linked to controversial industrial groups, Husnay Ara Shikha revealed that the BFIU has seized many accounts related to these groups, though no further details have been shared with the central bank at this time.

The spokesperson also discussed ongoing banking reforms, stating that multiple task forces are actively working on improving the efficiency of the banking system and recovering laundered money. Recruitment of lawyers and consultants from different countries is currently underway to assist in these efforts. Regarding the governance of Bangladesh Bank, she mentioned that complaints are received and handled by the HR department. Unless a specific complaint reaches the Governor, no action can be taken.

In response to questions about allegations against Parvez Tamal, Chairman of NRBC Bank, Husnay Ara Shikha confirmed that the matter is being investigated by Bangladesh Bank. She assured that updates would be provided at the next meeting.

Addressing the issue of Islamic banks, she mentioned that Bangladesh Bank is currently focused on reforming these institutions, along with the restructuring of the boards of 11 banks.

She highlighted the importance of addressing money laundering through legal processes, ensuring that actions are taken in accordance with the law. She also noted that Bangladesh continues to receive significant remittances, particularly from the United States, which, alongside foreign investments, remains a positive economic indicator.