Banks should be out of politics: Salehuddin Ahmed

Banks should be out of politics: Salehuddin Ahmed


A former governor of Bangladesh Bank has said banking sector reforms will not be beneficial unless banks are freed of political influence and pressure.Former central bank governor Salehuddin Ahmed made the comment at a roundtable on ‘banking sector reforms and governance’ in Bangladesh in Dhaka on Saturday.“Governance and accountability should be increased further in Bangladesh’s banking sector. For this political will is required. Politicians should bear in mind that a sector like banking should always be free of political influence,” he said.He said even if appointments were made on the basis of political affiliations in the banks, the appointees should be clearly told not to discuss their political ideologies in the banking sector.“The benefits of banking sector reforms cannot be reaped if banks are not freed of political influence,” he said.Salehuddin Ahmed, who headed the central bank from 2005-09, noted from his personal experience that apart from politicians even “lobbyists” brought a lot of pressure to bear on the governor of the central bank.“The Bangladesh Bank must take a firm stand. Problems of the banking sector cannot be solved unless it can function without any pressure.”

At the round table, the former governor also questioned the Bangladesh Bank’s ongoing ‘financial inclusion’ programme.“Is inclusive banking really in practice in Bangladesh? How much money is being allotted to the SME sector? One of my friends told me the other day that he had been running around for the last six months for Tk 1 million.”Quoting a study, he said, “Money earmarked for the SMEs are allotted to big businessmen. Poor people are not getting anything.”In this regard, he reminded the audience of the role played by the banks in creating entrepreneurs in Bangladesh.A non-profit advocacy and research organisation, Dhaka Forum, organised the round table at BRAC Centre in Mohakhali.Former advisor to the Caretaker Government Mirza AB Azizul Islam and Bangladesh Enterprise Institute President Farooq Sobhan were present, among others.


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