The ruling Awami League yesterday said it would take steps to rescue the ailing banking sector if it retains power, in an apparent recognition of the crisis that has been plaguing the industry for years.
The party vowed that it would deal with loan corruption with an iron hand and take legal actions against the bankers and clients involved with the scams, according to the manifesto, which was unveiled yesterday.
The party said it would empower the Bangladesh Bank to beef up its supervision over the scheduled banks and financial institutions.
A research conducted by the Centre for Policy Dialogue estimated that loan scams in 14 banks cost Tk 22,502 crore in the past decade.
The AL also made a promise to bring down default loans, a major concern for the banking sector.
Default loans stood at Tk 22,482 crore in 2009 when the party came to power in the first of its two last consecutive terms. The default loans increased by Tk 77,000 crore to around Tk 100,000 crore as of September this year, according to BB data.
The BB will take necessary steps to examine loan approvals, disbursement and banks' accountability to clients, said the manifesto.
The party pledged to formulate a bankruptcy act and implement it.
Massive irregularities and political intervention by an Awami League lawmaker led the new generation Farmers Bank to almost bankruptcy last year. The bank is now breathing by taking capital support from some government banks.
The numerous loan scams in the sector in the last decade also caught the attention of other political parties and alliances, which have pledged to take action against fraudsters in their election manifestos.
The BNP vowed that it would stop political interference in the banks if voted to power. It promised to close the banking division of the finance ministry in order to empower the BB and increase its control on the state banks.
The party pledged to publish the probe report on the reserve heist.
The heist of $81 million from the central bank's account with the New York Federal Reserve in February 2016 was one of the most discussed issues globally in the year. Three years on, the investigation report of the biggest-ever cyber heist has not been made public.
The Jatiya Oikyafront, an alliance of the BNP and some other parties, promised to bring the fraudsters who looted money from banks to book and empower the BB.
“It is a good sign that political parties are giving priority to the banking sector in their manifestos,” said Khondkar Ibrahim Khaled, a former deputy governor of the BB.
“Political parties always make commitments but they don't implement the pledges in reality,” he said, adding that discipline will be established in the banking sector if the promises are materialised.