Five banks facing a severe liquidity crisis have agreed with the Bangladesh Bank (BB) to borrow funds from financially stronger banks.

According to BB spokesperson Husne Ara Shikha, the deal, finalized on Sunday, includes National Bank, Social Islami Bank, First Security Islami Bank, Union Bank, and Global Islami Bank.

The central bank will guarantee these loans, charging a small commission for its service. The move is seen as a potential lifeline for these banks, which have been struggling since their boards were dissolved following the fall of the Sheikh Hasina government. Previously, these institutions were controlled by the S Alam Group.

Bangladesh Bank Governor Ahsan H Mansur initiated the proposal for liquidity support via interbank transactions to stabilize the banks. Approval from the central bank will be required for loan agreements, though the timeline for disbursing funds remains uncertain.