Financial Institutions Division
Profile
- Head
- Md. Zakaria
- Role
- Secretary
- Annual budget
- —
- Staff
- —
- Established
- 2001
- Legal basis
- Rules of Business 1996 (amended); Bangladesh Bank Order 1972; Bank Companies Act 1991; Financial Institutions Act 1993
Executing the Bank Resolution Act 2026 framework while coordinating state-owned bank NPL reduction (10% target by June 2026), overseeing the Sammilito Islami Bank merger, managing a Tk 35,000 crore capital injection into the five merged Islamic banks, and adjusting the merger statute to meet World Bank conditionality on the $1.7 billion reform package.
Recent activity
- 2026-02-26 appointment Md Mostaqur Rahman joined as 14th Governor of Bangladesh Bank on 26 February 2026, replacing Ahsan H Mansur who was removed by the BNP-led government; FID oversees policy coordination with the central bank. ↗↗↗
- 2026-03-26 appointment Md. Zakaria, formerly Chairman of the Bangladesh Food Safety Authority, appointed Secretary of the Financial Institutions Division in a cabinet-level bureaucratic reshuffle covering 12 ministries; predecessor Nazma Mobarek was transferred to the Ministry of Public Administration. ↗↗
- 2026-04-10 legal Bank Resolution Act 2026 passed in parliament by voice vote; converted the Bank Resolution Ordinance 2025 into statute, formalising the framework for merger, resolution, and recapitalisation of distressed banks, with a controversial provision allowing former owners to reclaim merged banks by paying 7.5 percent upfront of government-injected capital with the balance over two years at 10 percent simple interest. ↗↗
- 2026-04-15 policy Bangladesh Bank Governor Mostaqur Rahman reaffirmed continuation of the five-bank merger forming Sammilito Islami Bank PLC (licensed December 1, 2025 with Tk 35,000 crore paid-up capital; government share Tk 20,000 crore); FID coordinates the government ownership stake and capital injection authorisation. ↗↗
- 2026-04-20 policy BB Governor publicly announced plans to merge all nine state-owned banks into two large entities (four commercial banks: Sonali, Agrani, Rupali, Janata; two development banks: BASIC, Bangladesh Development Bank; three specialised banks: Bangladesh Krishi Bank, RAKUB, Probashi Kallyan Bank) to improve governance and reduce NPL concentration in public sector banks. ↗
- 2026-05-01 reform NPL reduction deadlines under active FID monitoring: state-owned banks required to reduce NPL ratio to 10 percent by June 2026, private banks to below 5 percent; FID is the administrative shareholder of the six state-owned commercial banks subject to these targets. ↗↗
- 2026-05-10 reform Government mulling amendment to Section 18(Ka) of the Bank Resolution Act 2026 -- the voluntary merger clause -- to satisfy World Bank conditionality linked to a $1.7 billion reform package ($500 million budget support loan plus $1.2 billion additional tranches); FID is the line division handling bank-side legislative compliance for the WB programme. ↗
Provenance & notes
FID is one of four divisions of the Ministry of Finance (alongside Finance Division, Economic Relations Division, and Internal Resources Division). It exercises administrative ownership over six state-owned commercial banks: Sonali, Agrani, Janata, Rupali, BASIC, and Bangladesh Development Bank, plus three specialised banks (Bangladesh Krishi Bank, RAKUB, Probashi Kallyan Bank), plus non-bank financial institutions and insurers. The established_year of 2001 is based on the Wikipedia article on FID indicating it was carved out as a separate division; the Bank and Financial Institutions Division existed under the MoF framework from 2001 per the Rules of Business. Secretary Nazma Mobarek held the post prior to March 26, 2026; Md. Zakaria (formerly Chairman, Bangladesh Food Safety Authority) took over on that date per BSS and TBS. BB Governor Mostaqur Rahman (appointed February 25, 2026, joined February 26, 2026) replaced Ahsan H Mansur; the governor change was the most significant single event in the FID's operating environment in this window. The Sammilito Islami Bank merger is FID-adjacent (Bangladesh Bank leads the banking resolution; FID manages the government capital stake). All figures verified against 2+ primary sources.
Sources
- https://fid.gov.bd/
- https://en.wikipedia.org/wiki/Financial_Institutions_Division
- https://www.bssnews.net/news/371758
- https://www.tbsnews.net/bangladesh/govt-reshuffles-top-bureaucracy-appoints-new-secretaries-12-ministries-and-divisions
- https://www.thedailystar.net/business/news/md-mostaqur-rahman-new-bangladesh-bank-governor-4114756
- https://www.bssnews.net/news-flash/363813
- https://www.tbsnews.net/bangladesh/process-underway-appoint-new-bb-governor-replacing-ahsan-h-mansur-sources-1370886
- https://www.tbsnews.net/bangladesh/bank-resolution-bill-passed-parliament-amid-opposition-objections-1408141
- https://www.thedailystar.net/business/banking/news/bank-resolution-act-2026-doors-open-ex-owners-reclaim-banks-4149496
- https://www.thedailystar.net/business/economy/news/reforms-tied-17b-wb-loans-govt-mulls-changing-bank-merger-clause-4177456
- https://www.tbsnews.net/economy/banking/govt-plans-merger-state-owned-banks-two-strengthen-governance-bb-governor-1340061
- https://www.newagebd.net/post/banking/292904/bb-governor-to-continue-merger-of-5-banks
- https://www.thedailystar.net/business/news/sammilito-islami-bank-gets-final-licence-4047446
- https://practiceguides.chambers.com/practice-guides/banking-regulation-2026/bangladesh
- https://bbf.digital/why-2025-marked-a-turning-point-for-bangladeshs-banks-record-npls-landmark-mergers-and-sweeping-reforms-reshape-a-sector-long-plagued-by-political-capture