The Bangladesh Bank will formally implement a risk-based supervision (RBS) system in the banking sector from January 2026, replacing the existing compliance-based model, Governor Dr. Ahsan H. Mansur announced.

Speaking at a press briefing in Dhaka, Dr Mansur described the upcoming system as “forward-looking and anticipatory,” aiming to enhance the quality of bank regulation.

The central bank has conducted a pilot with 20 banks and plans to include the remaining 41 by the end of 2025.

Twelve internal working groups have been formed to steer the transition, while an automated system is being developed to process banks’ responses under the new framework.

“If banks are not ready yet, they must prepare within the next six months,” Dr Mansur said, adding that the central bank seeks “360-degree supervision.”

He also revealed plans to adopt International Financial Reporting Standard 9 (IFRS-9) by 2028, although he acknowledged the timeline was ambitious.

Concerns about political interference and financial scams prompted the governor to stress the need for a shift in political culture and greater central bank independence.

“Political parties must learn from the current state of the banking sector, or risk repeating the mistakes of those now in exile,” he warned.

The governor also proposed a new model for appointing independent directors, ensuring more than half come from a vetted pool rather than personal networks.

An asset quality review of six banks showed poor performance, but turnaround plans may prompt reconsideration, he said.