Scribd Logo
Upload

Welcome to Scribd!

  • 14 views

    Institutions of Bangladesh": "Impact of COVID-19 Pandemic On Performance of Financial

    Uploaded by

    Mahfuzur Rahman
    The document discusses the impact of the COVID-19 pandemic on the performance of financial institutions in Bangladesh. It describes how the pandemic has increased financial risks for banks through lockdowns, rising non-performing loans, decreased investment and profits. While some insurance sectors have seen increased awareness and policies, overall revenues are decreasing. Other financial sectors like mortgage and investment companies have also been negatively affected.

    Copyright:

    © All Rights Reserved

    Institutions of Bangladesh": "Impact of COVID-19 Pandemic On Performance of Financial

    Uploaded by

    Mahfuzur Rahman
    14 views3 pages
    The document discusses the impact of the COVID-19 pandemic on the performance of financial institutions in Bangladesh. It describes how the pandemic has increased financial risks for banks through lockdowns, rising non-performing loans, decreased investment and profits. While some insurance sectors have seen increased awareness and policies, overall revenues are decreasing. Other financial sectors like mortgage and investment companies have also been negatively affected.

    Original Description:

    finance

    Original Title

    Finance Assignment

    Copyright

    © © All Rights Reserved

    Did you find this document useful?

    Is this content inappropriate?

    The document discusses the impact of the COVID-19 pandemic on the performance of financial institutions in Bangladesh. It describes how the pandemic has increased financial risks for banks through lockdowns, rising non-performing loans, decreased investment and profits. While some insurance sectors have seen increased awareness and policies, overall revenues are decreasing. Other financial sectors like mortgage and investment companies have also been negatively affected.

    Copyright:

    © All Rights Reserved
    14 views3 pages

    Institutions of Bangladesh": "Impact of COVID-19 Pandemic On Performance of Financial

    Uploaded by

    Mahfuzur Rahman
    The document discusses the impact of the COVID-19 pandemic on the performance of financial institutions in Bangladesh. It describes how the pandemic has increased financial risks for banks through lockdowns, rising non-performing loans, decreased investment and profits. While some insurance sectors have seen increased awareness and policies, overall revenues are decreasing. Other financial sectors like mortgage and investment companies have also been negatively affected.

    Copyright:

    © All Rights Reserved
    of 3

    “Impact of COVID-19 pandemic on performance of financial

    institutions of Bangladesh”
    The largest epidemic in the world today is the COVID -19 virus. The latest version of the corona
    virus is the world famous novel corona virus known as COVID -19. The World Health
    Organization declared the disease as an epidemic on March11,2020.
    In the 21st century, when people are trying to improve their lives by using science and
    technology, the effects of the corona epidemic have come like a natural curse.
    The outbreak of the COVID -19 epidemic and its widespread adverse effects have pushed
    economic growth around the world into negative territory by 2020. To control the spread of the
    virus, the government has imposed massive curfews, lockdowns, isolation and restriction on
    national and international transport.

    Impact of COVID -19 on the performance of financial institutions


    The most common types of financial institutions are central bank, commercial bank, insurance
    companies and brokerage firms etc. These entities offer a wide range of products and services
    for individual and commercial clients such as deposits, loans, investments and currency
    exchange.
    The coronavirus pandemic continues to have a major disruptive impact on the economic and
    financial environment. Governments are taking new measures to contain the virus, and the
    pandemic is still weighing on the outlook for financial stability. Vulnerabilities in the financial
    sector include public and private debt accumulation, increasing prospective credit losses and
    weaker profitability in the banking sector and greater risk-taking in the non-bank financial
    sector.
    Banking sector
    The crisis caused by COVID -19 is showing its first impacts on the banking sector. The banking
    sector was already struggling prior to the COVID -19 situation from skyrocketing Non-
    performing loans, declining margins in a capped interest rate regime, deterioration in virus
    efficiency indicators, government directed restructuring of loans, declining demand for loanable
    funds etc. Now the pandemic has put the sector into further stress.
    During the pandemic, the important factors that increase the financial risk of the banking sector
    are lockdown, increase NPLs, decrease individuals investment, decrease Banks gross profits,
    hamper regular banking activities, capital shortfall.
    According to the Bangladesh Bank data at last December, the total volume of the tk 10.18
    trillion were unsettled loans. From these loans tk 943.31 billion were classified NPLs. The
    division of financial institutions under the ministry of finance has anticipated that government
    owned banks will face loss of tk 7717.15 crore by the COVID-19 pandemic effect.
    data at last December, the total
    volume of Tk. 10.18 trillion were
    loans.
    From these loans Tk. 943.31 billion
    were classiied NPLs
    The banking sector is the key player of the economic activities of any countries. As a developing
    country, we need to be more watchful in terms of planning to get rid out of the impact of
    COVID -19 outbreak. During COVID -19 and after the pandemic, the central bank has ordered all
    other banks across the country to encourage customers to use cheques, mobile banking, online
    banking to reduce the spread of corona virus. The number of the registered mobile banking
    clients gradually increased to 99.34 million in December, 2020.
    Insurance sector
    COVID -19 has had both the positive and negative effects on the insurance sector. The positive
    aspects is that people have become aware of insurance. Their tendency to take out insurance
    policies has increased. On the downside, the revenue stream of insurance industry is suffering
    badly due to COVID-19 pandemic. Due to COVID-19 fire and marine insurance are expected to
    take the biggest hit. These two components consist of around 77% of non-life insurance
    companies total premium income.
    Other financial sector
    During COVID-19, other financial institutions such as mortgage companies, investment
    companies, brokerage firms, savings and loan associations are also affected. Like other
    economic players, the novel pandemic severely hit small business by disrupting national and
    international business networks, supply chain and demand. The pandemic reduces employment
    opportunities as most of the companies have stopped their process to cut their operating cost.
    As a result, the rate of unemployment increased from 47% to 58% in 2020.

    Although Bangladesh has recorded a strong growth rate in the last few years, the outbreak of
    the COVID-19 epidemic in the last quarter of 2020 has adversely affected at national economy,
    leading to a slowdown in growth. Following the negative impact of COVID-19, there has been
    less growth in all major sectors. During the lockdowns, economic activities almost came to a
    halt, as the government closed its offices and factories and imposed a travel ban. However, the
    government has taken up a huge stimulus package which acts as an emergency savings against
    economic losses.

    You might also like