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Introduction:
Supervision on banks and NBFIs is one of the most important tasks of Bangladesh Bank. Nature of
banking operations has changed many times in accordance with the pace of technological innovation/up
gradation. Keeping it in mind, central bank also adopts new measures, philosophy and mechanism to
combat the up coming challenges lay with the financial activities.
To ensure stability and compliance environment of the financial sector Bangladesh Bank, the central
bank of Bangladesh, has taken a good number of information and technology bases initiatives.
Introducing Online CIB Reporting, BACH, Core Banking Solution, Online EXP, IBP, IMP & Remittance
Reporting system and establishment of EDW (introduced for the first time in Bangladesh) are some
success history. As a part of this expedition BB is now going to introduce the Integrated Supervision
System.
Context:
Bangladesh Bank is aimed to establish a digitized work environment in the banking system to alien the
national philosophy of the country. Bangladesh Bank has initiated automation at early eighty decades
and then after the process gradually improving. BB achieved a major success in automation during last
seven years. Bangladesh Bank has developed various monitoring tools to strength the supervision
system as a whole. Automated Clearing House, Enterprise Data Management and Foreign Exchange
Monitoring Dash Board were the primary success history of BB. Considering these experiences BB has
started a comprehensive supervision research in late 2012 to develop an effective supervision and
monitoring model to strengthen the existing supervision system just after some bitter experience with
financial scam took place in the banking industries. Integrated Supervision System (ISS) is the outcome
of that thought.
Development History:
Primary thought generated by the honorable Governor of Bangladesh Bank.
A 07 (Seven) Member Development Committee was formed in 09th December, 2012.
Primary assessment report of the committee was approved by Governor on 25th February, 2013.
Primary software development work finished on 31 July, 2013.
Data testing started on August, 2013.
The Software was inaugurated by honorable Governor on 8th October, 2013
Mandatory reporting of banks head office and branches stated on March, 2014.
ISS Orientation 2
Goals:
To develop a micro effective macro prudential supervision structure.
To ensure the supervision effectively at all level of supervision structure.
Streamline the supervision efficiency of all supervision forces including the branch management
of a bank.
To integrate the supervision information
To ensure effective supervision
To adopt riskbased supervision approach
To minimize the supervision frequency
Strategic Objectives:
Utility of ISS
1. This monitoring tool enables BB to ensure dynamic supervision on root level activities of banks
and NBFIs.
2. Integrated Supervision System boostups the existing supervision technique and philosophy;
3. Enable BB to identify the supervision concerns and take action thereof more quickly than ever.
4. Risk focusing supervision has been started.
5. Integrated Supervision Management Cell has already developed a Pre-inspection Assessment
Report to point out the most important examining issues of a bank or branch. Furthermore the
ISS Orientation 4
system enables onsite supervisors to gather huge ready information what is useful for
inspection analysis and prepare quality inspection report.
6. Multi departmental information dependency has been reduce which will save time and help the
higher authority to get prompt decision.
7. Supervision control and responsibility fixation for supervision lapses will become easier for the
higher authority.
8. Discussion in various forums will become more informative.
9. Enable BB to find the policy gap and take necessary action thereto.
10. Reduce traditional data preparation workload and provide them huge opportunity for data
analyzing.
11. As a stakeholder of this system all banks and NBFIs will have to strengthen their own MIS, which
in fact develop their internal control environment.
12. Increase the analytical ability of supervision staff.