The central bank has asked the commercial banks to make sure that the rescheduled loans will not turn classified again and also to take necessary measures to check the tendency of classified loans.
The banks have been asked to ensure job security of their employees and stop gender harassment to facilitate establishing 'humane banking' in Bangladesh.
The instructions were issued at a meeting of bankers, held in the central bank headquarters in the city Thursday with Bangladesh Bank (BB) Governor Atiur Rahman in the chair.
"We've asked the bankers for strengthening monitoring and supervision so that fresh loans do not turn into classified ones," BB Deputy Governor S K Sur Chowdhury told the FE after the meeting.
He said the central bank asked the bankers to check the tendency of loan rescheduling again and again for the betterment of the banking industry.
"The bankers will have to expedite their recovery drives instead of loan rescheduling for improving the financial health of the banking sector," the deputy governor noted.
The BB's latest instructions came against the backdrop of declining trend of classified loans until the last quarter of 2014 following relaxation of the loan rescheduling policy.
The volume of non-performing loans (NPLs) fell by more than 12 per cent to Tk 501.56 billion in the fourth quarter (Q4) of the last calendar year from Tk 572.91 billion in the preceding quarter, the BB data showed.
During the Q4, the share of NPLs in the total outstanding loans of the banking system came down to 9.69 per cent from 11.60 per cent in the previous quarter.
The classified loans cover substandard, doubtful and bad/loss of total outstanding credits which stood at Tk 5,178.37 billion as on December 31.
The banks have been asked not to assign an official performing as credit risk officer for internal control and compliance for ensuring corporate governance in the banking sector.
"We've found at least four banks maintain such practices but it will not be allowed," another central banker said.
At the meeting, the managing directors and chief executive officers (CEOs) of all scheduled banks have been asked for taking necessary measures to ensure the job securities of their staff.
"The BB has already ensured job security of the CEOs so that they (CEOs) will have to ensure job security of their staff," the central banker explained.
Earlier on December 23, the BB amended its rules on appointment and removal of CEOs of commercial banks, prohibiting their sacking sans its prior permission.
Under the existing rules, the commercial bank authorities cannot force the CEOs to submit their resignation or cancel their appointment contract without prior approval of the BB.
The BB also asked the banks for taking effective measures to achieve the agriculture credit disbursement target by the end of the current fiscal (FY) 2014-15.
During the first nine months of the FY 15, all banks achieved nearly 72 per cent of their annual agricultural loan disbursement target for this fiscal, fixed at Tk 155.50 billion.
Different other issues including credit flow to the housing sector, fixing service charges on debit card and reducing interest rates on lending were discussed at the meeting.
Regarding security measures of the banks, chairman of the Association of Bankers, Bangladesh (ABB) Ali Reza Iftekhar said introduction of auto dialling system help ensuing security of the banks.
"The BB governor asked the banks to fix the targets of deposit collection and profit rationally," the ABB chairman told reporters after the meeting.
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