The Proliferation of Commercial Banking Sector in Bangladesh and the Competitive Position of Top Three commercial Banks
Sourov, Debashis Kundu
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The report based on analyzing the Banking industry of Bangladesh, which covers the competitive position of Hong Kong and Shanghai Banking Corporation (HSBC), Dutch-Bangla Bank Limited (DBBL), and Islami Bank Bangladesh Limited (IBBL). It was in 1996 that the first branch of HSBC in Bangladesh opened its doors for the first time. If you want to do business with it, you can get commercial and consumer banking, global liquidity and cash management for your money and trade service, treasury, custody and clearing, and more. HSBC has been working in Bangladesh for 25 years, and its international activities have been going on for over 150 years. HSBC opened a branch in Bangladesh in 1996. For the bank’s 25th anniversary, HSBC made a film to make people in Bangladesh think about how they can make changes for the better. In order to live, accept that things change, but shifting your focus can open up new worlds of opportunity. Seeing every change as a chance to improve. As shown in HSBC’s film, the world is always changing, and it is important for businesses to stay up to date with it. If you’re older, stay up to date with the younger generation, but the world is always moving. For Bangladesh, the Dutch-Bangla Bank was the first joint venture bank to open for business. Local shareholders, led by the bank’s first chairman, M Sahabuddin Ahmed, and a Dutch company called FMO, worked together to start the bank. Throughout the bank’s history, its main goal has been to help Bangladesh’s high-growth industries get money. People in Bangladesh make a lot of things and sell them all over the world. In the end, Bangladesh can grow as much as it wants because it has put money into this industry and focused on it. One thing Dutch-Bangla Bank is interested in is Corporate Social Responsibility (CSR) (CSR). There are a lot of words that describe what a company does for the community, but the Dutch Bangla Bank used them first to talk about how much they cared about the community. This work has made Dutch Bangla Bank the largest donor in Bangladesh. The bank is socially responsible, and it has won a lot of awards from all over the world. Islami Bank says that it is the “strongest Islamic retail bank in Bangladesh.” Bangladesh’s Islami Bank Bangladesh has won the Cambridge IFA and Islamic Retail Banking Awards’ seventh annual Islamic Retail Banking Awards for being the best Islamic retail bank in Bangladesh. If you read a news release from a school called Cambridge Institute of Islamic Finance, they say that it gave the prize out based on how well Islamic banks and retail financial institutions in the US, Asia and Africa were ranked. This is how Mohammed Monirul Moula, who is the head of Islami Bank Bangladesh, gave the honor to Nazmul Hassan. The same group also named Islamic Bank Bangladesh, which is in Bangladesh, “Strongest Islamic Retail Bank in Asia”. Bangladesh’s banking sector has been plagued by two key issues over the years, according to analysts. We have too many banks, owned by a small group of powerful individuals, and this is the first problem. They have routinely granted loans to subsidiaries owned by other bank owners or people linked with them, who are among the country’s most frequent loan defaulters. It linked this to the second issue, which is the tremendous rise in the banking industry in terms of non-performing loans (NPLs). In both cases, our regulators have either implemented or failed to implement rules that have led to them. For the first time in more than a decade, the Bangladesh Bank has agreed to allow banks to treat borrowers as defaulters if they pay only 15 percent (or more) of their total loan payments. They also made it possible for banks to record the unpaid interest on 85 percent (or less) of their loans in their income books, an increase from 75 percent a year earlier. Because of this liberal regulation, borrowers who paid only 15% of their loan balances each year could avoid default. With lower provisioning requirements, the operating profitability of most banks in 2021 went up.
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