Deposits in Bangladesh’s banking sector rose by Tk 345.17 billion between July and December 2024, according to the latest Bangladesh Bank report, recovering from a period of panic-driven withdrawals following political turmoil.

Total deposits across 61 banks reached over Tk 17.77 trillion by December, reversing the outflows triggered by the fall of the Hasina government on August 5. Public confidence in banks had declined as financial irregularities came to light, leading to large withdrawals. However, the situation has since stabilized.

To counter inflationary pressures, banks raised deposit rates, making savings accounts more attractive. The weighted average deposit interest rate rose to 6.01% in December, up 0.33 percentage points from July, while lending rates increased to 11.84%.

Cash held outside banks dropped by Tk 140 billion from June to December, settling at Tk 2.764 trillion. However, this amount has risen steadily since October 2023, when it stood at Tk 2.460 trillion.

Time deposits, including Fixed Deposit Receipts (FDRs), increased 8.33% to Tk 15.788 trillion, while demand deposits saw marginal growth to Tk 1.985 trillion.

The central bank attributes the rebound to improved financial stability and higher deposit rates, encouraging depositors to return their funds to the banking system.