Policy reformation, modernisation needed for strong financial market
UNB, Dhaka :
Prime Minister's Economic Affairs Adviser Dr Mashiur Rahman on Saturday said policy reformation, modernisation and policy simplification are needed for a strong financial market.
He also called upon large companies to float shares in the stock market and suggested to invest more in the manufacturing sector. "Our capital market does not have good shares nor good companies come into the share market, and for that reason investors have to depend on poor quantity of shares to trade," he said while addressing the seminar as the chief guest. Dhaka Chamber of Commerce and Industry (DCCI) organised the seminar on "Restructuring and Liquidation of Financial Institutions and Impact on Stakeholders" at its auditorium in the capital. Mashiur suggested the investors or depositors to invest or deposit their hard-earned money carefully and recommended the financial institutions to conduct internal as well as external audit in a transparent manner on a regular basis. Speakers at the seminar urged for proper monitoring, policy reforms, frequent auditing, selection of good borrowers for a disciplined financial market. DCCI President Osama Taseer said the financial sector is growing rapidly. "Despite remarkable improvement in the financial sector, some banks and financial institutions are facing crisis and navigating through difficult time. Institutional weakness, weak governance, lack of stringent due diligence in loan disbursement, concentration to large borrowers and slow loan recovery process raised serious concern about the efficiency and soundness of many financial institutions," he said. He also said Bangladesh Bank needs to strengthen its monitoring mechanism, early warning system to improve the financial health of weak financial institutions, standard benchmark of NPL across the financial sector and restriction of deposit collection of high NPL making concern.
Arif Khan, CEO and Managing Director of IDLC Finance Limited read keynote paper. He urged to establish bond market and discourage banks for long term lending.
Sohail RK Hossain, Managing Partner of RSA Consulting Partners and former Managing Director, The City Bank Limited also presented another keynote paper. To resolve crisis in the financial market, he stressed for consolidation of non-performing banks, more freedom to Bangladesh Bank, restructuring of weak financial institutions, increase Capital Adequacy Ratio, not breaching Advance on Deposit Ratio. He stressed the legal and structural weakness for recovery and collection of assets necessary for successful liquidation, which needs to be addressed.