What is the NPL ratio trend in Bangladesh's banking sector?
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The non-performing loan (NPL) ratio is a key indicator of banking health. In Bangladesh, NPL ratios have been a concern, with a significant portion of total loans classified as non-performing. The Bangladesh Bank monitors NPL ratios quarterly and publishes data through its Financial Stability Report. Factors contributing to high NPLs include weak governance, inadequate risk assessment, and economic slowdowns. The government and central bank have introduced measures to reduce NPLs, including stricter loan classification rules and debt recovery tribunals.