Green banking; prospects & challenges in Bangladesh with highlights from Dhaka Bank Limited

Abstract

Green Banking is one of the most talkative issues nowadays in the Financial Sector. All over the World the Financial Institutions are trying to contribute to protect the environment. Bangladesh Bank also made some policy guidelines for the Banks and Financial Institutions to achieve sustainable development. As per Bangladesh Bank Guidelines, all scheduled Banks except Probashi Kallyan Bank have formed their own Sustainable Finance Unit and Green Banking Policy. In the last quarter (October-December) of 2018, all scheduled Banks disbursed Tk.21,090.38 million for Green Banking. Analysis shows that, the Non-Bank Financial Institutions financed more for Green Initiatives than the Banks. From all scheduled Banks the Private Commercial Banks invested about 87.29% out of total 100% Green Financing by the Financial Sector. In the year 2017, among Private Commercial Banks, BRAC Bank disbursed Tk. 11,000 million for Green Banking purpose while Dhaka Bank Limited financed Tk. 6461.85 million for Green Banking and sustainability development. In the final quarter of the year 2018, our Financial Sector financed highest amount of money for Green Initiatives in the Recycling and Recyclable product Industry. The Financial Sector financed 34.22% of their total investment for Recycling and Recyclable product. In the Green Brick Manufacturing sector the Financial Institutions invested 25.03% of the total financing. From Dhaka Bank Limited more than 90% of the Employees said that they have clear idea about Green Banking. More than half of the Respondents believe that Dhaka Bank Limited provides proper training to the Employees about Green Banking. Around 60% of the Respondents said that Dhaka Bank Limited has some certain independent and unique green initiatives like tree plantation. However, in terms of setting up Green Branches (energy efficient buildings), 65% of the Respondents answered positively. Finally half of the Respondents stated that, Dhaka Bank Limited’s Higher Officials or top Management involves in environmental protection related planning and implementation. Few journals and reports published in different websites were reviewed for better understanding. Furthermore, few key findings were highlighted including the prospects of overall Financial Sector and Dhaka Bank Limited on Green Banking. At the end of this report, some recommendations were tried to provide based on the findings of the survey results and other analysis.