BB should independently do its job

As private banks experience serious liquidity crises, it is essential for the Bangladesh Bank (BB) to intervene before things worsen any further. BB slashed the cash reserve requirement (CRR) by one percentage point down to 5.5 percent, effective from April 15.

The decision was completely unwarranted, and we wonder whether the BB is being allowed to function independently. Reducing the CRR will not protect the interest of depositors. Banks must strengthen their governance and recover non-performing loans to prevent liquidity crisis from recurring.

Biplob Chandra Das, University of Dhaka