Govt spending Tk 40,000 crore this fiscal year to rescue weak banks
Finance Minister Amir Khosru Mahmud Chowdhury today said the government is spending around Tk 40,000 crore in the current fiscal year to recapitalise weak banks as part of a broader effort to restore discipline and stability to the financial sector.
While presenting the national budget for FY2026-27 in parliament, he said restoring the economy and sustaining private investment are among the government’s medium-term priorities.
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According to Khosru, the primary objective is to restore the financial health of weak banks and rebuild public confidence in a banking system undermined by systemic irregularities and rising non-performing loans.
The minister said recapitalisation is being accompanied by management reforms and the introduction of a risk-based supervisory framework to ensure long-term stability.
“A key focus is to restore confidence in the banking and financial sector by bringing discipline and stability to the sector,” he said.
Efforts are underway to reduce non-performing loans, ensure transparency in loan approval and loan rescheduling processes, and strengthen accountability in bank management, he added.
The finance minister said a risk-based supervisory framework will be introduced to rebuild the financial strength of weak banks. Where necessary, recapitalisation and management reforms will also be undertaken.
He further said initiatives have been taken to restructure banks to ensure the return of depositors’ funds.
The government has also undertaken measures to recover funds laundered abroad, Khosru said, adding that political appointments and interference in banking operations have been stopped.
“Necessary amendments to the law have been made to free the sector from undue family influence and control,” he said.
In his budget speech, the finance minister said international standards-based risk management, capital adequacy requirements and corporate governance practices would be ensured in the banking sector to make financial institutions stable and competitive in the long run.
“The scope of financial inclusion will be expanded by increasing access to finance for women, young entrepreneurs, and marginalised communities,” he added.
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