Bangladesh’s banking sector is grappling with a growing crisis due to a sharp increase in non-performing loans (NPLs). As bad loans surge, banks are failing to maintain required provisions, creating a record shortfall of Tk 170,655 crore as of March 2025. Capital reserves have plunged to historic lows, limiting investment capacity. Corruption during the previous government’s tenure worsened the issue. Although reforms are underway, unrecovered and laundered funds have weakened financial foundations, reducing profits and increasing loan interest rates across the economy.