WEB DESK
The international financial rating agency Moody’s in its latest Investors Services report downgraded the outlook for the Bangladesh banking sector to negative. Bangladesh alongwith Australia, Korea, New Zealand and Pakistan will have worsening state of banking operations, stated the Moody’s report. The downgrade could make credit in foreign currency costlier to businesses and banks operating in Bangladesh.
Moody’s said in its report that the outlook changed to negative as asset risks increased and liquidity situation tightened in the country.
Earlier, in December last year, Moody’s downgraded the rating of the Social Islami Bank of Bangladesh and put up the ratings of seven other banks under review for downgrade.
Financial sector experts have expressed concern over the downgrade of the banking sector. Bangladesh Bank’s former Governor Salehuddin Ahmed pointed out that the downgrade is for the entire banking sector which is a matter of concern. Multilateral agencies like the IMF and World Bank will now be cautious in funding Bangladesh, reported Business Standard. Another economist Zahid Hussain, who is the former lead economist of World Bank’s Dhaka office pointed out that it is the first time Bangladesh has been downgraded by Moody’s.