Bangladesh Bank (BB) Governor Dr Atiur Rahman warned Sunday of a bumpy ride on the road to restoring financial stability.

"Financial developments over the last twelve months have clearly demonstrated that the road to continuing restoration of financial stability in the country will not be long, but may be a bit bumpy,"

the governor said while speaking at the lunching of the Financial Stability Report 2012 at the central bank headquarters in the capital city.

The Financial Stability Report is published once a year through which the BB assesses the stability and resilience of the financial sector and the policy actions it advises to reduce and mitigate risks to stability.

  
Dr Rahman said the financial sector of this country is more comfortable than other neighbouring countries, especially the banking sector, which became comparatively stable with the BB's special drive for financial inclusion.

He, however, noted that the management and the financial situation of all banks are not equally satisfactory.
The governor said the central bank had already issued some necessary guidelines,

brought changes in rules and regulations and strengthen its monitoring system. But, the implementation of the guidelines and rules and regulations were not "reassuring" in the field of operations.

He advised banks to strengthen their own monitoring to establish and ensure corporate good governance and restore discipline in banking sector.

In this regard, the governor prioritized on state-owned banks against the backdrop of their poor performance in loan management. The current Financial Stability Report shows non-performing loan in five public banks soared to 63.0 percent last year.

Dr Rahman suggested all banks arrange trainings of bankers and management staff at home and abroad involving local and foreign experts.

Commenting on the current report, the governor said the prime objective of publishing this report is to provide an overview of the possible sources of risks and vulnerabilities to financial stability and to play an important role in preventing financial crises.