www.thedailystar.net ·
The Banking Sectors Dangerous Free Fall While Defaulters Thrive
The full article is on the original publisher site. This page only shows the headline and a very short excerpt.
AI insight
AI-generatedBangladesh's banking sector is in severe distress with extremely high NPLs and negative capital adequacy. The mechanism is regulatory/credit risk: relaxed rescheduling policies temporarily lowered NPLs but mask underlying asset quality deterioration. Capital shortfalls threaten solvency of several banks, potentially leading to credit contraction and higher borrowing costs for businesses. Impact is country-specific (Bangladesh), affecting primarily the banking sector and its borrowers.
Signals our AI researcher identified
Extracted by our AI model from this article and related public sources — not direct quotes from the publisher.
- NPL ratio peaked at 35.73% in Sep 2025, highest globally, then dropped to 30.60% by Dec 2025 due to relaxed loan rescheduling.
- 23 banks reported combined capital shortfall of Tk 2.82 lakh crore; 5 banks account for 59% of this deficit.
- Capital to risk-weighted assets ratio (CRAR) fell to negative 2.9% in Dec 2025, a historic low.
- Banking system criticized for discriminatory practices favoring urban over rural areas and wealthy over small depositors.
Over 1-4 weeks, capital shortfall of Tk 2.82 lakh crore leads to credit contraction and margin compression; bank loans and deposits are affected.
Sign in to see all sector verdicts, full thesis and counter-argument debate.
Sector impact at a glance
- EM_BANKINGmid
- EM_BANKINGshort