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Internal control, compliance of only 22 banks satisfactory

  • Published at 09:48 pm July 29th, 2019
BIBM research
Experts participate in a workshop on banks' internal control, organized by Bangladesh Institute of Bank Management in Dhaka on Monday Courtesy

The overall quality of internal control system of the banking industry was not up to the mark in 2018'

Internal control and compliance of only 22 out of 57 banks was at the satisfactory level while that of 21 banks was fair, that of 13 marginal and it was strong at only one bank in 2018, according to a Bangladesh Institute of Bank Management (BIBM) research. 

This was said in the keynote paper presented at a workshop “Use of Information Technology in Enhancing Efficiency of Internal Control System” organized by Bangladesh Institute of Bank Management in the capital on Monday.

Deputy Governor of Bangladesh Bank and Chairman of BIBM executive committee SM Moniruzzaman was chief guest. 

BIBM Professor and director Md Mohiuddin Siddique and review team presented the keynote paper at the workshop. 

"The overall quality of internal control system of the banking industry was not up to the mark in the year. Banks can improve this situation by using integrated IT (Information Technology) in each and every department," said the paper.

Bangladesh Bank deputy governor said, “We are at the dawn of the fourth industrial revolution. Today the banking system is heavily dependent on technology. From the use of core banking system to the use of internet banking, banks have surged ahead.”

"Banks can now monitor its different segments through sophisticated IT tools," he said, adding that the central bank also made significant strides in this regard. 

Md Nazimuddin, executive director of Bangladesh Bank and director general of BIBM, delivered the welcome address. 

Barkat-e-Khuda, Dr Muzaffer Ahmed Chair professor of BIBM and former professor of Dhaka University, chaired the workshop. 

In an open discussion on the workshop, IFIC Bank Deputy Managing Director Monitur Rahman said that internal audit system of the banks should be fully technology-based. Internal audit in the banking sector should be given more importance. 

The banker leading the internal control system should have a good idea about IT, he stressed, noting that young bankers seemed to know more about IT than the old ones. 

"So young people should be given a chance in this regard," Monitur said.  

BIBM Supernumerary Professor Helal Ahmed Chowdhury said that in the upcoming days information technology would be the part and parcel of banking. 

He suggested that IT sector should be developed for achieving the goals of SDGs. 

Barkat-e-Khuda said use of information technology should be increased for enhancing efficiency of internal control and compliance. 

"There will be new challenges in the banking sector so we need more skilled manpower in this sector. The maximum emphasis should be placed on training the bankers," he added. 

The research found that state-owned commercial banks covered around 72.30% of their branches under computerized system by 2016, while the private commercial banks and foreign commercial banks computerized all their branches by the time. 

At the end of 2018, all branches of state-owned commercial banks were computerized. 

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