Written by The Banking Post
Bangladesh Bank Governor Dr Ahsan H Mansur on Monday proposed creating a dedicated secondary market for savings certificates to make them fully tradable, saying such a move would enhance liquidity, benefit investors, and deepen the country’s financial market.
“Right now, savings instruments are only partially linked to the market. We need to make them fully tradable. If there is political will, this can be done,” he said while addressing a seminar titled Unlocking Bangladesh’s Bond & Sukuk Markets: Fiscal Space, Infrastructure Delivery and Islamic Money Market Development, jointly organised by the Bangladesh Securities and Exchange Commission (BSEC) and Dhaka Stock Exchange (DSE).
The governor also stressed the need for a parallel market for private bonds alongside government securities. “Ordinary citizens are already able to invest in government bonds, which is a positive step. Now, private bonds must also be made tradable under the right structure. That alone could double the bond market overnight,” he said.
Mansur pointed to long-term funding opportunities through pension schemes, provident funds, and corporate pension funds, adding that a pension regulatory authority is vital to ensure such funds are built properly.
He highlighted Bangladesh’s over-reliance on banks, contrasting it with the global economy where the bond market dominates with $130 trillion in outstanding bonds, equivalent to 130% of global GDP. “Our insurance sector is only 0.4% of GDP—too small to count,” he noted.
On Islamic finance, the governor said the sukuk market remains underdeveloped, with just six issuances worth Tk 24,000 crore so far. He suggested securitising revenue streams from mega projects such as the Padma Bridge, Jamuna Bridge, and metro rail to finance new infrastructure.
Mansur also underlined the urgency of expanding the insurance sector, pointing out that Bangladesh’s coverage stands at 0.4% of GDP compared to 4% in India and 12% in advanced economies.
He concluded by revealing that Bangladesh Bank has already prepared a research-based policy paper with specific reform proposals for both conventional and sukuk markets, which will soon be submitted to the government.
