Bangladesh Bank recently published a sustainable rating of Top Ten Bank of our countries and financial institutions for the first time. The Sustainable Finance Department (SFD) of Bangladesh Bank listed the top 10 sustainable Bangladeshi Bank and five non-bank financial institutions (NBFIs) of our country based on their performance in the year 2020. In this list there are 03 (Three) Shariah Based Banks and the other 07(seven) are conventional banks.
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Top 10 sustainable Bangladeshi Bank and Financial Institution list.
List of Top 10 sustainable banks
01. Al-Arafah Islami Bank Limited
02. Bank Asia Limited
03. BRAC Bank Limited.
04. Dutch-Bangla Bank Limited
05. EXIM Bank Limited
06. Islami Bank Bangladesh Limited
07. Mutual Trust Bank Limited
08. Prime Bank Limited
09. The City Bank Limited and
10. United Commercial Bank Limited
List of Top Five sustainable non-bank financial institutions
01. Hajj Finance Company Limited
02. IDLC Finance Limited
03. IPDC Finance Limited
04. Saudi Bangladesh Industrial and Agricultural Investment Company Limited
05. United Finance Limited
This rating is decided with the help of 08 departments of Bangladesh Bank according to the data provided by the bank at the end of the year -2020.
Bangladesh Bank identifies the Methodology for Sustainability Rating of Banks and Financial Institutions based on the following components/parameters.
Bangladesh Bank mainly divided the Methodology for Sustainability Rating of Banks and Financial Institutions component into two components. These are;01. Core Banking Sustainability and
02. Banking Services Coverage component
Under Core Banking Sustainability sub- component are;
| Sl. No. | Factors | Component Type |
|---|---|---|
| 1 | Net NPL Rate | Quantitative |
| 2 | Core Capital (Tier-1) against Risk Weighted Assets | Quantitative |
| 3 | Provision Maintenance Ratio | Quantitative |
| 4 | Net CMSME Loans and Advances Outstanding to Net Loans and Advances Outstanding Ratio | Quantitative |
| 5 | Exceeding Large Loan Portfolio Ceiling against Bank’s Total Loans & Advances | Qualitative |
Under Banking Services Coverage sub-components are;
| Sl. No. | Factors | Component Type |
|---|---|---|
| 1 | Number of Branches | Quantitative |
| 2 | Number of Deposit A/C | Quantitative |
| 3 | Number of Loan A/C | Quantitative |
| 4 | Number of Agent Outlet | Quantitative |
Along with this component Bangladesh Bank took into mind the amount of grants and financing on Education, Health and climate Fund of CSR activities. In addition to this, in the case of Green re-financing, performance of the banks is taken into consideration on yearly refinance rate, sector and sector wise refinance.
In our country there are 61 scheduled banks and 34 Non-Bank financial institutions operated under the full control and supervision of Bangladesh Bank. According to the Bangladesh Bank report on Green Financing by Banks and financial institutions, at the end of December 2020 Agrani Bank Limited financed Tk. 604 crore in Green financing projects which is the highest among the banks in our country.
At the second position Islami Bank Bangladesh Limited who financed Tk. 595 Crore, Then EXIM Bank Limited Tk. 502 Crore, BRAC Bank Limited Tk. 421 Crore, Al-Arafah Islami Bank Limited Tk. 142 Crore, Bank Asia Limited Tk. 122 Crore, IFIC Bank Limited Tk.107 Crore, NRB Bank Limited Tk. 65 Crore, Mercantile Bank Limited Tk. 18 Crore, BASIC Bank Limited Tk. 13 Crore.
These top 10 sustainable Bangladeshi Bank banks are financed more than 10% on Green financing projects of their total disbursed funded term loan. And among the non-bank financial institutions Bangladesh Infrastructure Finance Fund Limited (BIFFL) financed more than 05% on the Green financing project of their total disbursed funded term loan.