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Sl No.
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Name of OBU
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1
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Head Office Complex Branch, Dhaka
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2
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Agrabad Branch, Chittagong
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3
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Uttara Branch, Dhaka
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The financial system of Bangladesh is comprised of three broad sectors, categorised according to their degree of regulation:
| Sector | Description | Key Participants |
|---|---|---|
| Formal Sector | Fully regulated institutions under enacted financial laws | Banks, NBFIs, Insurance Companies, Capital Market Intermediaries (Brokerage Houses, Merchant Banks), MFIs |
| Semi-Formal Sector | Regulated but not under central financial regulators (BB, BSEC, IDRA) | HBFC, PKSF, Samabay Bank, Grameen Bank, NGOs, discrete government programmes |
| Informal Sector | Completely unregulated private intermediaries | Moneylenders, rotating savings groups (samity), private lending |
The three main constituents of any financial system are: Financial Institutions / Intermediaries, Financial Instruments, and Financial Markets.
Financial institutions are broadly classified into Banking Financial Institutions (BFIs) and Non-Bank Financial Institutions (NBFIs). The key difference: the liabilities of BFIs are money, whereas the liabilities of NBFIs are not money.
| Category | Number | Examples |
|---|---|---|
| State-owned Commercial Banks (SOCBs) | 6 | Sonali, Janata, Agrani, Rupali, BASIC, Bangladesh Development Bank |
| Specialised Development Banks (SDBs) | 3 | Bangladesh Krishi Bank, RAKUB, Probashi Kallyan Bank |
| Conventional PCBs | 33 | MBPLC, BRAC Bank, Dutch-Bangla, City Bank, Eastern Bank |
| Islamic (Shariah-based) PCBs | 10 | Islami Bank Bangladesh, Al-Arafah, Shahjalal, EXIM, SIBL |
| Foreign Commercial Banks (FCBs) | 9 | Standard Chartered, HSBC, Citibank N.A., State Bank of India |
| Non-Scheduled Banks | 5 | Grameen Bank, BSBL, Ansar VDP Unnayan Bank |
New Bank Setup Requirements:
The financial market in Bangladesh is mainly of the following four types:
The money market deals in short-term financial instruments (maturity up to 1 year). It is regulated by Bangladesh Bank (BB).
Key participants: Banks, NBFIs, and Primary Dealers (PDs).
▶ Updated: 24 Primary Dealers now operate in the money market (updated from the old figure of 15). These are banks authorised to deal in government securities both in primary and secondary markets.
| Instrument / Operation | Details |
|---|---|
| Call Money Market | Overnight inter-bank lending; most sensitive segment of money market; participated by scheduled banks and FIs |
| Repo / Reverse Repo | BB's key monetary policy tools; banks borrow/lend against government securities |
| Treasury Bills (T-Bills) | Short-term government securities (91-day, 182-day, 364-day) |
| BB Bills | 7-day, 14-day, 30-day, 91-day BB Bills available |
| Taka Treasury Bonds | Long-term (2, 5, 10, 15, 20 year maturities); secondary trade through PDs |
| EDSMoney | Electronic Dealing System for Interbank Money Market |
The capital market deals in long-term financial instruments (maturity more than 1 year). It is regulated by the Bangladesh Securities and Exchange Commission (BSEC).
| Segment | Description |
|---|---|
| Primary Market (NIM) | New Issue Market — companies issue new stocks/bonds via IPO (Initial Public Offering), rights shares, or private placement. Regulated and approved by BSEC. |
| Secondary Market | Previously issued securities are bought and sold. Includes Organised Stock Exchanges and OTC market. |
Stock Exchanges:
| Exchange | Est. | Location | Indices |
|---|---|---|---|
| Dhaka Stock Exchange (DSE) | 1954 | Dhaka (Nikunja) | DSEX, DS30, DSES (Shariah) |
| Chittagong Stock Exchange (CSE) | 1995 | Chittagong | CASPI, CSI (Shariah) |
Key Capital Market Intermediaries:
Instruments traded: Equity securities (shares), debentures, corporate bonds, treasury bonds, mutual fund units, ETFs (Exchange Traded Funds), Sukuk (Islamic bonds).
The foreign exchange market facilitates buying and selling of foreign currencies. It is regulated by Bangladesh Bank under the Foreign Exchange Regulation Act (FERA), 1947 and Guidelines for Foreign Exchange Transactions (GFET).
Key milestones:
| Feature | Current Status (2025) |
|---|---|
| Exchange Rate Regime | Managed Floating — market-determined with BB intervention to prevent extreme volatility |
| Taka Convertibility | Convertible on current account; NOT freely convertible on capital account |
| FDI Repatriation | Profits, capital gains, and disinvestment proceeds freely repatriable for non-residents |
| Resident Capital Abroad | Subject to prior Bangladesh Bank approval |
| Regulator | Bangladesh Bank (FEPD — Foreign Exchange Policy Department) |
| Authorised Dealers (ADs) | Licensed banks authorised to deal in foreign exchange; 22 AD branches of MBPLC |
Foreign Exchange Instruments in Bangladesh:
The insurance market deals in trading of insurance products (life and non-life). Regulated by the Insurance Development and Regulatory Authority (IDRA) established under the Insurance Development and Regulatory Authority Act, 2010. There are over 78 insurance companies operating in Bangladesh.
| Basis | Type A | Type B |
|---|---|---|
| By Issuance | Primary Market (new securities issued) | Secondary Market (existing securities traded) |
| By Duration | Money Market (short-term, up to 1 yr) | Capital Market (long-term, over 1 yr) |
| By Trading | Organised Stock Exchange (listed securities — DSE, CSE) | OTC Market (non-listed or unlisted securities) |
| By Security | Security Market (shares, bonds — regulated by BSEC) | Non-Security Market (banking, insurance — regulated by BB/IDRA) |
| Regulator | Established | Regulates | Legal Basis |
|---|---|---|---|
| Bangladesh Bank (BB) | 1972 | Banks, NBFIs, forex market, payment systems | BB Order, 1972; Bank Company Act, 1991 |
| BSEC | 1993 | Capital market, stock exchanges, merchant banks, AMCs | Securities and Exchange Commission Act, 1993 |
| IDRA | 2010 | Insurance companies (life & non-life) | Insurance Act, 2010 |
| MRA | 2006 | Microfinance Institutions (MFIs) | Microcredit Regulatory Authority Act, 2006 |
Bangladesh Bank has developed a robust electronic payment infrastructure replacing traditional paper-based systems:
| System | Full Name | Function |
|---|---|---|
| BACH | Bangladesh Automated Clearing House | Umbrella system for all automated clearing |
| BACPS | Bangladesh Automated Cheque Processing System | Electronic cheque clearing |
| BEFTN | Bangladesh Electronic Funds Transfer Network | Electronic credit/debit transfers |
| RTGS | Real Time Gross Settlement | High-value real-time interbank settlements |
| NPSB | National Payment Switch Bangladesh | Interoperability of ATM/POS transactions |
| MFS | Mobile Financial Services | bKash, Nagad, Rocket — mobile payments |
| Item | Detail |
|---|---|
| Central Bank | Bangladesh Bank — established 16 December 1971 (BB Order, 1972) |
| 1st Governor, BB | A. N. Hamidullah |
| 14th Governor, BB | Md. Mostaqur Rahman, FCMA (joined 26 February 2026) |
| Scheduled Banks | 62 (6 SOCB + 3 SDB + 33 Conv. PCB + 10 Islamic PCB + 9 FCB) |
| NBFIs | 35 |
| Primary Dealers (PDs) | 24 (in money market / treasury securities) |
| Stock Exchanges | DSE (Dhaka, est. 1954) and CSE (Chittagong, est. 1995) |
| Capital Market Regulator | BSEC (Bangladesh Securities and Exchange Commission) |
| Exchange Rate Regime | Managed Floating (since May 2025, per IMF conditions) |
| Taka Convertibility | Current account: YES | Capital account: NO |
| Gross Forex Reserves | Approx. USD 30 billion (July 2025); Net (BPM6): ~USD 24.99 billion |
| Bank Setup Capital | BDT 500 crore (conventional/Islamic) | BDT 125 crore (Digital Bank) |
| Islamic Bank Total Assets | Exceeded BDT 5 trillion (mid-2025); ~20% share of total banking assets |
