BAB calls for confiscating assets of bank looters, seeks 7.5% corporate tax cut for listed banks

The Bangladesh Association of Banks (BAB) has urged the government to confiscate the assets and shares of individuals and groups accused of looting the banking sector, saying stronger recovery measures are essential to restore confidence in the financial system.
The apex body of private bank owners made the demand during a meeting with the Finance Minister Amir Khosru Mahmud Chowdhury, alongside a series of fiscal and regulatory proposals aimed at stabilising the country's struggling banking sector.
In a statement, BAB said meaningful recapitalisation of banks would not be possible without swift legal action against controversial former sponsors and major loan defaulters.
The organisation also expressed concern over certain provisions of the proposed Banking Resolution framework, particularly Section 18K, warning that any possibility of controversial sponsors or major defaulters returning to the banking system could undermine depositor confidence and weaken ongoing reform efforts.
According to BAB, the overall Capital Adequacy Ratio (CAR) of the banking industry has fallen to nearly 3%, creating severe stress across the sector and limiting banks' ability to finance industries, SMEs, employment generation and investment expansion.
To help banks navigate the crisis, the association proposed reducing the corporate tax rate for listed banks by 7.5 percentage points from the current 37.5%.
Among its other recommendations, BAB called for full tax deductibility of loan-loss provisions for the next five years and removal of additional taxes on stock dividends to encourage capital retention.
The organisation also sought fast-track approval for rights share issues and recapitalisation initiatives, along with stronger coordination between Bangladesh Bank and the Bangladesh Securities and Exchange Commission (BSEC) to facilitate capital raising.
BAB further recommended establishing fast-track financial courts and a centralised Asset Management Company (AMC) to speed up the disposal and management of distressed assets.
The association also urged the continuation of SME refinance, green financing, Long Term Financing Facility (LTFF) and other refinance schemes for banks operating under approved recovery plans.
In addition, BAB proposed amendments to governance provisions under the Bank Company Act, including narrowing the definition of "family" to spouses, dependent children and financially dependent relatives.
The association also stressed the need to expand digital interoperability and Bangla QR adoption to accelerate the development of a modern cashless financial ecosystem.
















