Bangladesh: Capacity Development for Bangladesh Bank

Sovereign Project | 45088-001

Summary

The objective of the technical assistance (TA) is to support implementing a capacity development plan for Bangladesh Bank (BB), which is necessary to improve the conduct of monetary policy in Bangladesh. This objective will be achieved by adopting a comprehensive two-pronged approach. First, the TA will help BB to improve its internal capacity by providing training to the selected staff to (i) prepare good quality technical reports/guidelines covering conventional monetary management and financial supervision; (ii) carry-out technical analysis and surveys that are necessary to prepare these reports/guidelines; and (iii) implement new supervision guidelines. Second, the TA will support dissemination of new initiatives and monetary management tools through workshops and conferences.

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Project Name Capacity Development for Bangladesh Bank
Project Number 45088-001
Country Bangladesh
Project Status Closed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 7841-BAN: Capacity Development for Bangladesh Bank
Technical Assistance Special Fund US$ 500,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Finance - Banking systems and nonbank financial institutions - Money and capital markets

Gender Equity and Mainstreaming No gender elements
Description

The objective of the technical assistance (TA) is to support implementing a capacity development plan for Bangladesh Bank (BB), which is necessary to improve the conduct of monetary policy in Bangladesh. This objective will be achieved by adopting a comprehensive two-pronged approach. First, the TA will help BB to improve its internal capacity by providing training to the selected staff to (i) prepare good quality technical reports/guidelines covering conventional monetary management and financial supervision; (ii) carry-out technical analysis and surveys that are necessary to prepare these reports/guidelines; and (iii) implement new supervision guidelines. Second, the TA will support dissemination of new initiatives and monetary management tools through workshops and conferences.

The impact of the TA will be improved conduct of monetary policy. The performance indicators are (i) a policy paper on inflation management framework detailing the operational procedures, in line with the broad monetary policy objectives that go beyond traditional inflation targeting; and (ii) a financial sector risk management plus assessment framework is in place. The TA will strengthen the in-house capacity of BB, which is necessary to improve the conduct of monetary policy by addressing its multiple objectives. Thus, the outcome of the TA will be assessed by the institutional structures and the guidelines that are in place and to include (i) bringing-out bi-annual financial stability reports (FSRs), (ii) carrying-out business expectation and inflation expectation surveys at regular intervals, (iii) implementing revised banking regulations in line with international best practices, and (iv) publishing a few well-articulated policy/strategy papers on the relevant topics by the Bangladesh Bank staff.

Project Rationale and Linkage to Country/Regional Strategy
Impact Improved conduct of monetary policy with multiple objectives, including price and financial stability
Project Outcome
Description of Outcome Strengthened capacity in the Bangladesh Bank
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

1. Capacity development support for preparing financial stability reports

2. Capacity development support for preparing a policy paper on inflation management and targeting

3. Capacity development support for revising and implementing regulations on banking supervision

4. Capacity development support for carrying out surveys on business and inflation expectations

5. Capacity development support for designing macroprudential policies and instruments

6. Capacity development support for writing and editing skills training

7. Capacity development support for study tours

8. Capacity development support for conference/workshop

Status of Implementation Progress (Outputs, Activities, and Issues)

1. The second round of the inflation expectation survey has already been completed and the results will be presented on 9 September 2014 in Dhaka.

2. All the consultants have completed their assigned tasks.

Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation The closure of the TA is ongoing.
Business Opportunities
Consulting Services About 20 person-months (PMs) of consultancy services (8 PMs international, 12 PMs national) will be required. All consultants will be hired on an individual and intermittent basis. The international consultants will include monetary management specialist and financial sector specialist. The national consultants will include a survey expert and an economics editor. The consultants will be engaged by ADB in accordance with the Guidelines on the Use of Consultants (2010, as amended from time to time). All procurement of equipment will be undertaken in accordance with ADB's Guidelines for Procurement (2010, as amended from time to time). The TA will be implemented over 2 years and is expected to commence in September 2011.
Responsible ADB Officer Hiranya Mukhopadhyay
Responsible ADB Department South Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SARD
Executing Agencies
Bangladesh Bank30 Storied Building (25th Floor)
Motijheel Commercial Area
Dhaka 1000, Bangladesh
Timetable
Concept Clearance 19 May 2011
Fact Finding 06 Mar 2011 to 09 Mar 2011
MRM -
Approval 26 Jul 2011
Last Review Mission -
Last PDS Update 08 Sep 2014

TA 7841-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Jul 2011 02 Apr 2012 02 Apr 2012 30 Sep 2013 31 Oct 2014 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
500,000.00 0.00 45,000.00 0.00 0.00 0.00 545,000.00 26 Jul 2011 242,396.34

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Safeguard Documents

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Evaluation Documents

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