Dhaka, Bangladesh (BBN) - The central bank has issued policy guidelines on green banking for nine new commercial banks to protect environment and ensure sustainable banking practices.
The banks will be allowed to implement the policy guidelines under a time framework, which will be segregated into three phases, according to a circular issued by the Bangladesh Bank (BB) Wednesday.
As per the guidelines, the banks have to develop green banking policies and show total commitment to protection of environment through in-house performance.
From now on, the timeline for actions to be taken in the first phase must not exceed June 30, 2014 while the timeline for actions to be taken in the second phase must not exceed December 31, 2014.
A system of environmental management must be in place in every bank before initiation of activities in the third phase.
Under the guidelines, the banks have to address the whole eco-system by taking environment-friendly initiatives and introducing innovative products. Standard environmental reporting with external verification will also be part of the phase, the timeline for which must not exceed June 30, 2015.
“Green banking is a component of the global initiative by a group of stakeholders to save environment,” a senior official of the Bangladesh Bank (BB) told the BBN in Dhaka.
The central banker also said Bangladesh is one of the countries, most vulnerable to climate change.
In tandem with global developments and response to the environmental degradation, the financial sector in Bangladesh should play its important role as one of the key stakeholders, he added.
“The banks will have to report on their green banking practices to the central bank on a quarterly basis,” another BB official said, adding that the new banks now would get the access to refinancing facilities from the BB under the green banking.
The new banks are NRB Commercial Bank Limited, South Bangla Agricultural and Commerce Bank Limited, Union Bank Limited, Meghna Bank Limited, Midland Bank Limited, The Farmers Bank Limited, NRB Bank Limited, Modhumoti Bank Limited, and NRB Global Bank Limited.
The banks will submit their first quarterly reports by October 15, 2013 and similarly they will be required to continue to submit reports on the subsequent quarters within next 15 days of the end of every quarter, according to the circular. “The banks will keep their annual report and websites updated by providing disclosures on green banking initiatives or activities.”
BBN/SSR/AD-11Sept13-9:26 pm (BST)
