Stronger institutions key to banking sector recovery: ERF chief

President of the Economic Reporters’ Forum (ERF) Doulot Akter Mala on Wednesday said greater transparency, stronger institutions and continuity of policies are essential for restoring confidence in Bangladesh’s banking and financial system.

Speaking at the MTB-FE roundtable titled 'Banking Sector Reforms’, organised by The Financial Express (FE) at Six Seasons Hotel in Dhaka on Thursday, she said it was feared that the economy would collapse amid liquidity stress and reserve depletion.

However, she noted, decisive steps by the authorities helped avert a bank run and stabilise the reserve position, providing relief to an import-dependent economy.

Mala said the end of loan evergreening has enabled journalists to see the actual health of banks, which is crucial for accountability.

She also flagged capital flight and a declining tax-GDP ratio as major concerns, warning that money laundering undermines tax compliance and forces the government into repeated borrowing.

Criticising the slow pace of reforms, she said key institutions such as the Anti-Corruption Commission and financial intelligence bodies remain inadequately equipped, limiting effective investigations and asset recovery. She also stressed the need for depoliticising regulatory bodies, including Bangladesh Bank, and ensuring press freedom to allow scrutiny of real conditions.

Mala urged policy continuity beyond regime changes, warning that unpredictable policy shifts discourage investment. While acknowledging steps such as bank board reconstitution and joint investigation initiatives, she called for better coordination and a structured approach to ensure sustainable reforms and public confidence.

Mutual Trust Bank PLC was the title sponsor of the roundtable, while BRAC Bank PLC and NCC Bank PLC were gold sponsors. Trust Bank PLC, Shahjalal Islami Bank PLC, Eastern Bank PLC, and Mercantile Bank PLC were co-sponsors.