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Published : 11 Jun 2026, 09:48 PM
Finance Minister Amir Khosru Mahmud Chowdhury has proposed scrapping the requirement for commercial banks to obtain Bangladesh Bank approval when relocating branches within the same region.
Presenting a Tk 9.38 trillion budget for the 2026-27 fiscal year in parliament on Thursday, he said procedures related to branch rentals, relocations, interior works, and lease renewals would be streamlined.
In his budget speech, he proposed that decisions on such matters, including the relocation of branches within the same area, be left to the boards of directors of individual banks, removing central bank oversight in these cases.
Currently, Bangladesh Bank sets standards for opening new branches and related furnishing and renovation costs.
Commercial banks are required to obtain prior approval from the central bank for opening new branches, relocating existing ones, refurbishment, renting premises, and extending lease agreements.
The central bank took greater control over these activities following allegations of “excessive spending” on branch rentals, advance payments, and interior decoration.
It later issued guidelines after repeated allegations that banks were paying unusually high deposits for buildings owned by directors or influential individuals, paying excessive rents, and purchasing materials at inflated prices.
Following findings that rental costs and furnishing expenses varied significantly among bank branches operating in the same region, Bangladesh Bank introduced spending limits on rent, relocation costs, and per-square-foot furnishing expenses.
Before granting approval, the relevant department of the central bank reviews the financial aspects of such proposals and compares spending patterns across banks before making a decision.
If the finance minister’s proposal is approved, bank boards will be able to make all decisions on existing branches without seeking prior approval from Bangladesh Bank.
