Published: 07:04 AM, 12 June 2026
BDT 400 billion will be spent to save dysfunctional banks
The government is spending more than Tk 400 billion this current fiscal year as recapitalization to rescue weak banks, Finance Minister Amir Khosru Mahmud Chowdhury informed in his budget speech on Thursday.
He said restoring discipline in the banking and financial sectors and rebuilding public confidence in these sectors constitute one of the government's key medium-term priorities for supporting economic recovery and sustaining investment flows.
To this end, measures are being undertaken to reduce non-performing loans, enhance transparency in loan approval and rescheduling processes, and strengthen accountability in bank management and governance, according to him. The minister said a risk-based supervisory framework will be introduced to restore the financial soundness of weak banks, while recapitalization and management reform measures will be undertaken where necessary. "It is worth noting that the government is having to spend more than Tk 400 billion in the current fiscal year for the recapitalization of banks," Amir Khosru Mahmud Chowdhury said.
To improve the effectiveness of policy implementation in the financial sector, he said, the government will strengthen the supervisory authority of the central bank, introduce the necessary legal reforms to eliminate political interference in banking operations, and ensure that bank governance is free from undue family influence. International standards relating to risk management, capital adequacy and corporate governance will be adopted to enable financial institutions to become more stable, resilient, and competitive over the long term. At the same time, greater use of technology will be encouraged to promote digital finance, fintech solutions, and innovative financial services across the economy.
