Dhaka, Bangladesh (BBN) – The central bank of Bangladesh has allowed one more credit rating agency –Waso Credit Rating Company (BD) Limited — as an external credit assessment institution (ECAI) to assess credit risks in line with the Basel-II framework, officials said.
“The central bank has recognized the Waso Credit Rating Company as an eligible ECAI to meet the bank clients’ additional demand for credit rating as well as improve competition among the credit rating agencies,” a senior official of the Bangladesh Bank (BB) told BBN in Dhaka.
The central banker also said all the scheduled banks operating in Bangladesh might nominate one or more rating agencies for doing their own and counterparty credit rating for the purpose of calculating the risk-weighted assets (RWA) against credit risk as per the Risk Based Capital Adequacy (RBCA) guidelines.
Currently, six credit rating agencies — Credit Rating Information and Services Limited (CRISL), Credit Rating Agency of Bangladesh (CRAB), National Credit Rating Limited (NCRL), Emerging Credit Rating Limited (ECRL), ARGUS Credit Rating Services Limited (ACRSL) and Alpha Credit Rating Limited (ACRL) — are operating in Bangladesh.
The mapping of the new rating agency was already set to calculate the RWA, the BB official said adding that the central bank already issued a circular in this connection.
“All public sector entities (PSEs) along with corporate houses will come under the risk-weighted calculation system in line with the Basel-II framework and it will help minimise credit risks,” the BB official noted.
Bangladesh is now implementing the Basel-II accord to consolidate the capital base of banks in line with the international standard.
It has been prepared taking into account three things: minimum capital requirement, supervisory review process and market discipline.
BBN/SSR/AD-05Nov12-10:40 am (BST)
