Experts pinpoint key areas of emphasis for banks

FE Report | Thursday, 8 November 2018

Effective liquidity management, maintaining foreign exchange balance and ensuring financial inclusion should be the key operational and management areas of a bank, experts said at a programme on Wednesday.
They added that the banks should also lay emphasis on compliance issues, corporate governance and asset liability management aiming to achieve sustainable growth.
The suggestions came at a session on 'Key operational and management areas of Banks-2', on the first day of the two-day Annual Banking Conference organised by the Bangladesh Institute of Bank Management (BIBM) at its auditorium in the city.
The session was chaired by Banking Reforms Adviser to Bangladesh Bank (BB) Shitangshu Kumar Sur Chowdhury.
BB Executive Director Md Shah Alam, Managing Director (MD) of Bangladesh Krishi Bank Ali Hossain Prodhania, MD and Chief Executive Officer (CEO) of EXIM Bank Limited Dr Mohammed Haider Ali Miah, and MD and CEO of Islami Bank Bangladesh Limited Md Mahbub-ul- Alam attended the panel discussion.
Speaking on the occasion, Mr Sur Chowdhury said a bank should abide by all compliance issues concerning both regulatory bodies and customers.
"A fully compliant financial institution's profit may be limited at the initial stage, but it would continue to increase in the long term" the central banker said.
Besides, sustainability of a bank largely depends on better corporate governance, he said.
"You cannot quantify the level of corporate governance in a financial institution, but its importance is perceived in the long term sustainability," he said.
At the time of recession, banks or other financial institutions with poor corporate governance are more likely to collapse earlier, he added.
In his speech, Mohammed Haider Ali Miah, human welfare and environment protection, should also get priority in banking operations.
He also said training and other activities related to human resource development can significantly enhance the productivity of a bank.
They were responding to five study papers presented at the beginning of the session by researchers from various institutions including BIBM.
The first paper on efficiency of Commercial Banks in Bangladesh examined the technical efficiency of a sample of first generation and second generation commercial banks.
Environmental Management Accounting (EMA) practice was the focal point of the second paper.
The third paper explored the relationship between front line employees' perceptions of service-oriented HRM practices and their influences on both in-role and extra-role service behaviour of bank employees in Bangladesh.
Balance between work and family life of a PCB employee was the theme of the fourth paper.
The last paper of the session made a comparison between non-bank financial institutions (NBFIs) and banks in Bangladesh.