Financial Sector in Bangladesh Recent Trends and Benchmarking for the Government

Abstract

Financial sector of Bangladesh is a bank-based system that has been facing a number of challenges alongside operational expansions. In spite of some notable development, performances of certain section of banks have not been praiseworthy in terms of efficiency and soundness parameters. In view of the situation, the financial sector needs directions and appropriate measures to offer due support to attain sustainable growth targets of the country. This secondary data-based study has attempted to analyse the underlying issues related to operations and performances of the banking and financial industry to put forward some necessary regulatory and policy initiatives. For consolidation of the industry, the study recommended for: addressing willful default; revitalising internal control and compliance; ensuring uniform regulatory environment; working for product diversification and exit strategy; addressing financial crime and money laundering; promoting cluster development and financing; endorsing technology-driven and inclusive banking; supporting development of capital, bond and insurance market; and above all, improving corporate governance and leadership.