In a major move to safeguard the national economy, Bangladesh Bank (BB) has announced that all finance companies will now fall under the jurisdiction of the Bank Resolution Ordinance 2025. This directive empowers the central bank to manage liquidity support, mergers, and liquidations of non-bank financial institutions (NBFIs) with the same authority it exercises over scheduled banks.
The Bank Resolution Department of Bangladesh Bank issued a circular on Sunday (December 21), citing Section 95 of the new ordinance. This section grants the central bank the legal framework to intervene in financial institutions to maintain systemic stability and protect public interests.
Provisions previously applicable only to scheduled banks are now extended to all finance companies licensed under the Finance Company Act 2023.
The ordinance provides a structured legal pathway for Providing emergency liquidity support to struggling firms. Facilitating mergers and acquisitions to prevent institutional collapse. Executing forced liquidations if a company is deemed non-viable.
A senior central bank official emphasized that these measures are designed to ensure that the "insolvency or mismanagement" of a finance company does not trigger a broader financial crisis.
This move marks a significant shift toward a more aggressive and streamlined regulatory oversight of the country's financial landscape.
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