Bank executives warn that instability at the country’s largest Islamic lender could affect confidence across Bangladesh’s banking sector.
DHAKA, Bangladesh | June 10, 2026
Bangladesh’s leading bank executives have expressed deep concern over ongoing instability at Islami Bank Bangladesh PLC, saying the situation is affecting the wider banking sector and requires a quick resolution.
The concerns were raised on Wednesday following a meeting between senior bank executives and Bangladesh Bank Governor Mohammad Mostakur Rahman, according to Masrur Arefin, Chairman of the Association of Bankers, Bangladesh (ABB) and Managing Director of City Bank.
Speaking to reporters after the meeting, Arefin said the challenges facing Islami Bank are no longer an issue for a single institution.
“The impact is being felt across the banking sector,” he said, adding that bankers remain worried about the situation.
Concerns Extend Beyond Banking
Arefin said the central bank governor views the issue not only as a banking-sector problem but also as a matter with political dimensions.
According to him, efforts are underway to find a solution through discussions and understanding among the parties involved.
Islami Bank Bangladesh PLC is the country’s largest Islamic commercial bank and plays a significant role in Bangladesh’s financial system. Any disruption at the bank can have broader implications for depositor confidence and overall financial stability.
Central Bank Calls for Stronger Governance
During the meeting, Governor Rahman reportedly reiterated his commitment to strengthening governance in the banking sector.
Arefin said the governor urged bank chief executives not to yield to political pressure and instructed banks to provide accurate information to the Credit Information Bureau (CIB), Bangladesh’s central database for borrower credit records.
The governor’s comments come as Bangladesh continues efforts to improve transparency, accountability, and risk management across its financial institutions.
New Fund Planned for Small Businesses
Bank executives and regulators also discussed measures to increase lending and support economic activity.
According to Arefin, the government and Bangladesh Bank are planning to establish a new fund worth 600 billion taka (approximately $5 billion).
The fund is expected to provide financing support to small and medium-sized enterprises (SMEs), which are considered a key driver of employment and economic growth in Bangladesh.
The money will be distributed through Bangladesh Bank’s refinancing programs, allowing commercial banks to extend loans to eligible businesses.
Focus on Trade Data and Import Pricing
Another topic discussed at the meeting was the quality of trade-related reporting.
Arefin said delays and inaccuracies in export and import data submissions sometimes create problems in national economic accounts.
He noted that significant discrepancies have been observed in the declared value of imported goods, raising concerns about trade transparency and pricing practices.
To address the issue, participants emphasized the need for banks to verify prices through international platforms and online sources before opening letters of credit (LCs) and conducting trade transactions.
The goal, officials said, is to prevent excessive payments for imported goods and protect the country’s foreign exchange resources.
Financial Sector Under Scrutiny
The meeting brought together managing directors from banks across Bangladesh, along with all deputy governors and senior officials of Bangladesh Bank, the country’s central bank.
The discussions reflect growing attention on banking-sector stability at a time when Bangladesh is working to strengthen financial governance, improve lending conditions, and maintain confidence in its banking system.
Sources
- Statements by Masrur Arefin, Chairman of the Association of Bankers, Bangladesh (ABB)
- Briefing following the bankers’ meeting with Bangladesh Bank Governor Mohammad Mostakur Rahman
- Reporting by Prothom Alo
