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IFC Helps Bangladeshi Banks Manage Risk in Tough Times
Dhaka, Bangladesh, March 17, 2009─IFC,
a member of the World Bank Group, is engaging with financial institutions
in Bangladesh and other South Asian countries to help them better manage
risks amid the unfolding global financial crisis.
As part of this effort, IFC hosted a
workshop today in Dhaka that brought together representatives from international
and local financial institutions to discuss best practices in risk management
and implications of financial-sector policy changes, particularly in response
to the turbulent and rapidly changing financial environment. This
workshop will create awareness among local financial institutions about
the global financial crisis and current trends and developments in risk
mitigation approaches.
“Poor risk management practices have
resulted in the current financial crisis, causing a severe credit crunch,
and banks need to win back investors’ trust,” said Michael Higgins, IFC
Banking Specialist. “Through this discussion, we are better placed to
understand implications of the international crisis on the financial and
banking system and identify possible solutions.”
The workshop, “Managing Risks in Good
Times and Bad,” was the second in a series that began on March 13, in
Mumbai, India. It helped the banking industry discuss liquidity, operational
risk management, corporate governance and risk mitigating approaches.
“To create a robust risk management
system, banks need to correctly assess risks and mitigate them through
insurance or other means,” asserted Jan P. Mumenthaler, IFC Principal
Insurance Officer. “Bangladesh’s insurance market is encouraged
to present itself as a reliable and well-performing partner in this process
by offering the appropriate solutions for financial institutions.”
Roger D. Handberg, IFC Program Manager
for Access to Finance in Bangladesh, said, “So far there has been no major
impact on balance sheets of banks in Bangladesh, however this is bound
to happen and banks need to be prepared. It is critical for them to consider
and implement mitigation measures and the clear lesson from the crisis
is to keep an eye on liquidity.”
IFC South Asia, in partnership with
the Government of Norway and DFID (United Kingdom), works to support the
growth of small and medium enterprises through increased access to finance,
an improved business environment and strengthened value chains.
About IFC
IFC, a member of the World Bank Group creates opportunity for people to
escape poverty and improve their lives. We foster sustainable economic
growth in developing countries by supporting private sector development,
mobilizing private capital, and providing advisory and risk mitigation
services to businesses and governments. Our new investments totaled $16.2
billion in fiscal 2008, a 34 percent increase over the previous year. For
more information, please visit www.ifc.org.
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