Bangladesh Bank (BB), on the other hand, is going to launch a package programme to increase investment in small and medium enterprises (SMEs) and agro-based industries. The BB governor and senior bankers held an informal meeting recently on how to promote SMEs and agro-based industries. The central bank has decided to formulate a policy and float a fund for lending in those sectors, sources said.

As part of the ongoing reforms, the central bank will also begin exclusive monitoring of the poorly performing banks. Besides, it is going to appoint 10 local and 22 foreign consultants to strengthen some of its departments including information technology and human resources.

The BB will also install a central information platform to establish an online network with its six divisional offices as well as the commercial banks. BB's Credit Information Bureau (CIB) that supplies information on creditors to other banks will also be part of this online network.

The central bank has already signed contracts with the commercial banks to this end.

The BB is also going to introduce some changes in its supervision and monitoring process of the commercial banks. Under the new procedure, the 'good' banks will be treated separately from the five banks identified by the BB as 'problematic' ones, who will be placed under exclusive supervision. The central bank is also considering separate monitoring of the banks which are not performing well but have not yet turned into 'problematic' ones. The BB has identified four such banks.

BB Deputy Governor Mohammad A Rumi Ali explained, "We are introducing this exclusive supervision as a measure to stop the poorly performing banks from performing worse and also to help improve their performance."

On strengthening the banking information system, he said, "Without proper information at the right moment, we cannot take the right decisions. That's the reason we are emphasising IT development in all banks."

The central bank has also decided to go for vigorous reforms in the NCBs, although there are debates on the issue.

NCB Reforms Taskforce Chairman and BB Deputy Governor Nazrul Huda notes, "The financial base of these banks are so weak that we have no alternative but to reform them." Such reforms are now being resisted by, what the banking sector believes, "bad bankers" and "bad borrowers".

On appointing advisers to the NCBs, Huda said, "This measure is being employed in 30 other countries. The government is right in taking such a timely measure."

The commercial banks, meanwhile, are on the lookout for new sectors as potential borrowers, as Pubali Bank Managing Director (MD) Khandker Ibrahim Khaled illustrates, "This year we will open our doors to health, power, textiles and other untapped sectors."

"The health sector, for instance, has tremendous investment prospects. A large number of patients seek treatment abroad because of inadequacies of the local hospitals," he observed.

"If the private sector seeks loans for power projects, we will also respond positively."

"Threatened by the approaching post-multi-fibre agreement (MFA) situation, the garment sector also needs our help -- especially the small garment companies. So, we will give more lending facilities to small garment firms to help them overcome the post-MFA hurdles," the Pubali Bank MD added.

Janata Bank MD Murshid Kuli Khan said, "In addition to financing the regular good projects, we are considering lending for power, roads, bridges and other infrastructure."

Bankers say all the big lending for infrastructure projects will be made through syndication.

Asked whether these measures will increase investment, Ibrahim Khaled said, "The success of our initiatives will depend on some non-economic factors like law and order, corruption and governance issues."