The Association of Bankers, Bangladesh Limited (ABB), is an organisation that fosters friendship among bankers, and provides a forum for the discussion of common issues. Since its establishment in 1997, its role has been pivotal in the development of the country’s economy.
ABB chairman, K Mahmood Sattar asserts that in recent years Bangladeshi banks have experienced noteworthy developments through the development of private sector interests. “Out of the 48 banks, 30 are from the private sector. 10 years ago the nationalised banks had 70 per cent market share. Today it is the reverse – the private sector makes up 68 per cent of the market.”
The SME sector – said to account for over 95 per cent of the nation’s business enterprises – is currently the focus of bankers’ interest, as more consumer items and export-oriented goods are produced. “We are being encouraged to look at SMEs, and this is really taking off,” affirms Mr Sattar.
The World Bank Outlook for 2012 forecasts that emerging and developing countries will lead the way in the global economic recovery. Bangladesh’s banking sector is adopting measures to create regulations that will safeguard the nation’s economy against any possible future financial and operational risks.
“I think the two strongest pieces of regulation which have come in have been the Basel II adoptions. Every bank in Bangladesh is Basel II compliant,” explains Mr Sattar. “We have finished the first phase and we are now in the second phase which concerns the strategic pillars, where additional capital is required... We have been talking about Basel III as well.”
ABB continues its efforts to spread its reach to the unbanked population. According to Mr Sattar, currently “9 per cent of our population are bankable,” though he is optimistic about future prospects. “Soon this figure will be up to 30 per cent.”
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