State of the Bangladesh Economy in FY2023-24 (First Reading)
Independent Review of
RBD
Bangladesh's Development
Capital inadequacy of banks
ā Bangladesh Bank's Guidelines on Risk Based
Capital Adequacy state that banks must
maintain a minimum total capital ratio of 10%
(or minimum total capital plus capital
conservation buffer of 12.5%) by 2019, in line
with BASEL III.
However, the SCBs have failed to maintain
minimum requirements of capital adequacy.
On the other hand, the SBs have remained
critically under-capitalised.
ā Without reducing NPLs, capital
adequacy cannot be improved since higher
levels of NPLs lead to increased provisioning
requirements, which results in capital shortfall.
CPD (2023): State of the Bangladesh Economy in FY2023-24 (First Reading)
PER CENT
40
30
NA
20
10
0
-10
-20
-30
-40
-50
Figure: Capital to risk weighted asset ratios
(in %)
MAR-10
MAR-11
MAR-12
MAR-13
MAR-14
MAR-15
MAR-16
MAR-17
MAR-18
MAR-19
MAR-20
MAR-21
MAR-22
MAR-23
-SCBS
SBs
-PCBs
-FCBs
All banks
42View entire presentation