Banking CentralisationDhaka grabs over 60pc of national savings

Bank deposits in Dhaka division account for more than half of the total deposit in the country’s banking system, reflecting acute income and savings disparities between people of the capital and that of other areas.

According to the Bangladesh Bank data, deposits in the scheduled banks in the Dhaka division totaled Tk10,78,561 crore as of March this year, representing 62.20% of the total deposits of Tk17,62,303 crore in the country’s banking industry.

Besides, the Dhaka division has also taken the lead in terms of loans. By the end of March, the amount of loans disbursed by the local banks reached Tk15,61,227 crore. Of that amount, Tk10,61,455 crore or 68% was disbursed in Dhaka alone.

Dr AB Mirza Azizul Islam, a former finance adviser to the caretaker government, said that people in North and South-West regions are significantly deprived in terms of savings and incomes.

“A disparity prevails and a large number of people in those areas live below the poverty line. As a result, regional disparities are becoming more pronounced. Despite establishing businesses and factories in various districts, entrepreneurs are taking loans primarily from banks in the capital.”

This is happening because obtaining loans in Dhaka is easier, and solving problems is also more convenient here if any issue arises, he observed.

Moreover, compared to rural areas, Dhaka offers additional opportunities and facilities in various aspects. A majority of the employees reside in Dhaka, leading to a higher accumulation of deposits here, he added.

Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue (CPD), said production and development activities happening outside Dhaka are significant now, but everyone prefers to both invest and save in Dhaka.

Many from the rural areas are buying flats in Dhaka and settling here permanently, he noted, adding, “So, they are engaging in transactions with banks in this area.”

“This centralisation of Dhaka is not beneficial for the economy. Our communication infrastructure is improving now. If we can develop various city centres outside Dhaka, savings opportunities can also be found there. Nowadays, people earn in rural areas and save in cities. Decentralised development is necessary,” he maintained.

Mymensingh division has the lowest deposit

According to the central bank’s quarterly statistics of scheduled banks for the January-March period, the share of deposits in the Mymensingh division was the lowest – Tk28,525 crore – among all the areas of the country.

The banks in Dhaka division have accumulated a total deposit of 10,78,561 crore. Of that amount, Dhaka district alone held Tk9,14,399 crore. Additionally, Narayanganj had Tk35,985 crores, and Gazipur had Tk32,293 crores in bank accounts.

The amount of deposits was Tk3,72,765 crore in the Chattogram division, constituting 21.15% of the deposit base. Chattogram district had Tk2,40,637 crore, Noakhali Tk19,449 crore, Brahmanbaria Tk16,341 crore, Feni Tk16,002 crore and Chandpur Tk14,169 crore in deposits.

Khulna division had Tk74,110 crore in terms of deposit, Rajshahi Tk70,435 crore, Sylhet Tk69,996 crore, Rangpur Tk34,318 crore and Barishal Tk33,592 crore during the first quarter.

Barishal lags behind in loans

Loan distribution in the Barishal division was the lowest – Tk18,896 crore – among all the areas of the country in the January-March quarter.

Bank loans distributed in Dhaka district amounted to Tk9,83,639 crore, Narayanganj Tk22,515 crore, Gazipur Tk15,505 crore, Narsingdi Tk7,952 crore and Tangail Tk6,882 crore during that time.

In the Chattogram division, despite the presence of large business establishments, the loan distribution was not significant. The amount of loans in the division in the first quarter of this year was Tk277,065 crore. Loans amounting to Tk236,748 crore was distributed in Chattogram district.

In terms of loans, the Rajshahi division came third with Tk63,393 crore disbursed in the January-March period.

During the same quarter Tk60,714 crore loan was distributed in Khulna division, Tk38,933 crore in Rangpur division, Tk21,081 crore in Mymensingh division and Tk19,687 crore in Sylhet division.