Experts at a ceremony on Monday observed that there are several dimensions of ethics in banking, but the most important aspect is banking governance.
They opine that practicing the ethics in banking, the role of the Board of Directors as well as the Chief Executive Officers of the banks is very significant for banks’ overall performance.
The remarks came up in the “Twentieth Nurul Matin Memorial Lecture on Ethics in Banking”, organized by the Bangladesh Institute of Bank Management (BIBM) at it’s auditorium.
Fazle Kabir, Chairman of BIBM Governing Board and Governor of Bangladesh Bank presided over the session while BIBM Director General Dr. Md. Akhtaruzzaman made address of welcome.
Eminent economist Dr. Sadiq Ahmed, Vice Chairman of Policy Research Institute (PRI) delivered keynote speech in this program.
Former governors, deputy governors, senior central bankers, government high officials, BIBM’s chair and supernumerary professors, top executives from different banks and financial institutions, university professors, academicians, faculty members of BIBM, senior bank executives, media representatives, officers of BIBM took part on the occasion.
In his keynote speech, Dr. Sadiq Ahmed, Vice Chairman of Policy Research Institute (PRI) said, there are several dimensions of ethics in banking. The most important aspect is banking governance. Prior to the reform program initiated in 1998, banking sector governance was very weak. Even as late as 1997, the banking sector was dominated by corrupt and inefficient public banks, accounting for 67% of total deposits and 63% of total loans. Many of the loans of these banks were non-performing owing to weak discipline and inefficient management Loan and interest recovery culture was lax. In summary, banking ethics was weak.
Fazle Kabir, Governor of Bangladesh Bank said, practicing the ethics in banking, the role of The Board of Directors as well as the Chief Executive Officers of the banks is very significant for banks’ overall performance. The separation/independence of management in its business decision and execution of the banking activities are expected to run smoothly and would be in support of the boards in an ideal scenario.
In line with the international best practices Bangladesh Bank, the Central Bank of the country has formulated necessary regulations for both the roles of board of the banks and management of the banks with a view to ensuring the sound corporate governance and ethics in the banking sector, he added.
BIBM Director General Dr. Md. Akhtaruzzaman said, BIBM each year arranges this prestigious memorial lecture in hallowed memory of Late A.F.M. Nurul Matin.
“This is 20th in the series. Each year the banking sector discovers new messages of ethics from this memorial lecture.The Banking sector will be highly benefited from such lecture”, he added.
Nurul Matin joined the Research Department of the State Bank of Pakistan in 1951 as an Officer Class I and, subsequently, his services were placed in the operational departments of the Bank in 1963.
