IMF urges Bangladesh to address banking sector weaknesses

IMF urges Bangladesh to address banking sector weaknesses

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Responding to a question about bank mergers, Chris Papageorgiou said that this initiative of Bangladesh Bank is needed because of the 61 banks of Bangladesh, some are very strong while others are not.

The IMF team expressed satisfaction that Bangladesh has introduced the monthly fuel oil price adjustment system. Chris Papageorgiou commented, “The authorities have made significant progress on structural reforms under the IMF-supported program, including the implementation of a formula-based fuel price adjustment mechanism for petroleum products… We look forward to realigning the exchange rate.” We welcome the bold steps of Bangladesh Bank to adopt a crawling peg regime with one band as a transitional step towards restoring external flexibility. Subsequently, additional tightening of monetary policy will help mitigate any inflationary pressures resulting from the exchange rate correction.

In a recent event, former Bangladesh Bank Governor Muhammad Farashuddin said that the IMF never discusses money laundering. However, when questioned about the issue, Chris Papageorgiou stressed that one of the most important policies of the IMF is the control of money laundering.

He further explained that establishing good governance also includes measures to prevent money laundering.

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