BB now can hire ICFs for banks

The central bank has introduced special regulations to hire international consulting firms (ICFs) for commercial banks in order to improve their financial health through diagnosing the bank companies.

The central bank communicated the special regulations to managing directors and chief executive officers of all scheduled banks through issuing a notification on Sunday.

Earlier, the Board of Directors of the Bangladesh Bank in its 438th meeting made the regulations styled 'The Special Regulations of Bangladesh Bank-2024'. The regulations take immediate effect.

"The central bank is now empowered to hire ICFs under the special regulations instead of the existing Bank Company Act," a senior central banker told the FE while explaining the main objective of the regulations.

He also said the process of hiring ICFs for some banks is scheduled to start from January 2025.

The regulations are aimed at undertaking a risk-based comprehensive assessment of the banks concerned by any competent ICF with a view to initiating appropriate remedial measures.

The regulations are deemed proper and necessary in the public interest and for improvement of the state and condition of bank companies as well as bank policies.

Comprehensive assessment means a risk-based diagnostic study, which includes asset quality review, review of corporate governance, review of bank's policies, procedures, processes and compliance of laws and regulations and any other assessment as and when necessary.

ICF means a firm or corporate body, which has sufficient expertise and experience in foreign market, other than the country of registration, in conducting risk-based comprehensive assessment of a bank company.

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