Bangladesh’s banking sector is facing a severe crisis marked by record levels of non-performing loans (NPLs), rising capital and provisioning shortfalls, and declining investor confidence. According to the latest Bangladesh Bank data, total bad loans have surged to Tk 6.45 trillion, representing 35.77% of all distributed credit. Analysts attribute this deterioration to years of mismanagement, irregularities, and alleged looting during the previous Awami League government. Experts warn that the incoming government after the February election will inherit a fragile financial system, with nearly half of the country’s banks struggling to survive. Liquidity shortages, high lending rates of 14–18%, and declining deposits are further constraining investment and job creation. Economists fear that without strict action against top defaulters and systemic reforms, the banking sector’s instability could severely undermine Bangladesh’s overall economic recovery and growth prospects.