The World Bank and the Asian Development Bank (ADB) will provide $2.5 billion in Bangladesh to reform the banking and financial sector.
The $2.5 billion loan will be provided in several packages, of which the World Bank will provide $1 billion and ADB will give $1.5 billion. This loan can be used as a support for the modernization and capacity building of Bangladesh Bank, including banking sector reforms.
Bangladesh Bank (BB) had a separate meeting with the two global lenders. The central bank spokesperson Husne Ara Shikha said that the loan assistance was assured in the meeting on Sunday.
She said that the World Bank has announced to provide loan assistance of $1.0 under three conditions for the reform of the bank and financial sector of Bangladesh. But now the World Bank will pay $750 million for policy assistance. This support will be available in December. Another $250 million loan assistance will be given as an investment loan and guarantee facility.
ADB will give $1.5 billion. In the first tranche, ADB will give $500 million. The next two phases will provide another $1.0 billion.
She also said that Bangladesh has to fulfill certain conditions to get the loan. These include the creation of asset management companies in the private sector, new definitions of defaulted loans in international standards, and the audit firm's report on the newly formed task force.
However, 50 percent of the conditions have already been reformed, said the central bank officials.
The BB Governor Dr. Ahsan H Mansur held a meeting in the central bank with Brent Neiman, Assistant Undersecretary for International Financial Affairs of the United States Department of Revenue and Finance.
The meeting discussed how to improve the macroeconomy. In this, various issues including inflation, money laundering, and growth came up. The governor informed about the various steps taken by the central bank because of the overall situation to protect the stability of the country's economy.
The governor was assured that the United States would provide all kinds of support to reform the financial sector.
