A national disgrace
The Bengali Roots Editorial Desk
This week’s episode at the Bangladesh Bank is just another case in point. With one shock after another, people hardly raise an eyebrow any longer.
At the central bank headquarters came that moment when officials chanted for the ouster of a senior adviser; they surrounded him, shouting slogans into his face each time they cornered him and even physically intimidated him- a regime not just out of control but interested in making disorder itself emotionally as dramatic.
That was no resistance; it was not even a question of bureaucratic policy. Simply put, it was disorder.
Once disorder reaches the central bank, the consequences are much more than a mere shattering of its high walls. They spread outward in waves and are felt to their very core.
That’s a scene that should never have been enacted.
On Wednesday last, at the Bangladesh Bank, there was one crucial question
If, inside the building of the central bank of a sovereign nation, a crowd of officials can forcibly eject and bully a senior advisor, what kind of control does that show they have there?
The central bank is more than just another federal building. It guards monetary stability, oversees banks and brings confidence to finance. Financial institutions, private enterprises- all rely on bank trust. Ordinary people, too. Unlike stocks or government bonds, there is no performance credit or ledgers.
Scenes of disarray and intimidation are the quickest way to destroy everything.
Right after getting such an education, anyone at home has heard nothing further about institutional strength. The central bank itself is the nation’s financial nerve centre; vulnerable discipline is so much clamour and numbers. When the limiter lifts (here, “the network of other forces” releases a raft of disasters upon an institution.
An Unpopular Reformer
Governor Ahsan H. Mansur, who had taken long-needed reform steps, was similarly dismissed. His plan is said to have included:
Combining operationally weak banks
Enhancing supervisory powers
Dealing with deliberately defaulting borrowers (in banking jargon,’ wilful default’)
Strengthening accountability
Nor is the interest of entrenched forces challenged, popular. Would have found that a reform is never popular. popular. But inexorable necessity rendered it so. “Reforms are never meant to be popular.” Editor’s Remarks: Following the resignation of his successor, we soon experienced another bout of regular turbulence. This has always been how the elite structure of Bangladesh has acted, however. Shying away from reforms is one raison d’etre; ossifying the privileges that were once stumbled upon is another. Accountability is never fully in mind. The Troublesome Habit of Complacency. For quite some time now, the banking sector in Bangladesh has been confronting bad loans created by politicians and weak oversight. Trust between banks and the people has gradually eroded. During the previous government, personal connections and rewards were often put before principles. This requires a different kind of institution, an institution that is a long way from a firm foundation. Had they remained unobserved, it might well have been. It may seem quite a bold idea, but the Central Bank cannot live in an environment where public opinion dictates what it does. In other words, an independent institution without strong safeguards is not an unnecessary extravagance; it’s essential to financial security. Moment of Decision for the Government. These days, there is no escape- It’s really now or never for Bangladesh. At this stage, the government can only take resolute steps in decisions and measures that will ensure that: The BB puts its act back together.
Through institutions, they protect their true integrity
The people who actually make the decisions are not the very people jumping on bandwagons, for whom they lack authority for
Merit and oversight become the benchmarks again. It is unthinkable that we inject even more cynicism from the public into the equation. This will deal another blow to an already extremely troubled banking sector.
The central bank should serve as a principal, not a pusher. In compliance with law, not decibel sounds.
Because if the watchdog of the Chinese financial system is unwilling to move, we all have to suffer.
Editor’s Note
Bangla Roots monthly magazine supports the method of emissaries as a better way of doing things. It is a pity that, at the outset of October this year, people had to give symbolic names to the music therapy room and playroom there — an incredible period indeed for what might otherwise have been Bangladesh Bank. The process helps to resolve problems confronting the broader setting of proinancial institutions and governance in this country as a by-product (Index page 35). We are not inciting discord, but rather seeking clarity in thinking, encouraging long-term, helpful decisions, and advocating a form of governance in which everyone has a stake.
