M SHAHRIAR AZAD BHUIYAN

Bangladesh’s banking sector is entering a historic transformation as five Shariah-based private commercial banks prepare to merge into a single state-owned Islamic bank. The institutions under consideration are First Security Islami Bank, Global Islami Bank, Union Bank, Social Islami Bank and EXIM Bank. Backed by the Bangladesh Bank, the merger aims to restore confidence in Islamic banking, improve governance and strengthen financial stability. Yet for shareholders, one question remains: what will happen to their investments?

The national budget for FY2025-26 has disappointed capital market stakeholders. Despite persistent bearish trends, declining investor confidence, and repeated calls for reform, the budget offers little in terms of meaningful support for the country’s capital market.

The announcement of steep tariff hikes by the United States under its new trade posture—currently on a 90-day pause—has sent ripples across global markets. For Bangladesh, the stakes are especially high. The readymade garment (RMG) sector, which accounts for more than 84 percent of national export earnings and employs over four million workers, faces a new wave of uncertainty. Since the US is Bangladesh’s single largest RMG export destination, purchasing over $6.8 billion worth of apparel in fiscal year 2023-24, the proposed tariff regime poses real challenges.

The Bangladesh Bank’s recently announced monetary policy statement (MPS) for the second half of FY25 continues its contractionary stance, aimed at curbing inflation while cautiously supporting economic recovery. However, this policy shift has substantial implications for Bangladesh’s capital market, influencing investor sentiment, stock valuations, and liquidity.

Bangladesh’s stock market has been bearish for the past 14 years, leading to significant losses for many investors, erosion of their confidence and weakening of numerous associated institutions, such as the Investment Corporation of Bangladesh (ICB).

Monetary policy is a crucial tool for managing a country’s economy. It involves the regulation of money supply and interest rates by a central bank to achieve macroeconomic objectives such as controlling inflation, maintaining currency stability, and fostering economic growth. For a developing country like Bangladesh, an effective monetary policy is essential in steering economic stability and growth, especially during periods of global economic uncertainty.

As stakeholders in Bangladesh's capital market drew the curtain on a personal. year, the dawn of 2024 brings with it a glimmer of hope and anticipation.

Mutual funds have emerged as a popular and beneficial option for individuals seeking to grow their personal wealth.