The spread between banks’ weighted average lending and deposit rates remained unchanged at 5.70 per cent in June 2026 from the previous month, according to the Bangladesh Bank data released on Tuesday.
The all-bank weighted average deposit rate stood at 6.16 per cent in June, while the lending rate was 11.86 per cent.
The central bank, seeking to keep borrowing costs at reasonable levels across the economy, particularly for productive sectors, instructed banks to cap the spread between weighted average lending and deposit rates at 4.0 percentage points, excluding credit cards and consumer loans, effective from June 29.
Bankers, however, said the new ceiling was unlikely to be achieved immediately as many banks were forced to procure funds at relatively high costs.
They also said the cap could discourage banks from expanding lending to small and medium-sized enterprises (SMEs), despite the fact that the central bank and the government were urging to fund SMEs.
SME funding is believed to be risky, where regular monitoring is required with adequate working forces.
"Actually, the regulation is not scientific because some banks procure funds at a higher cost while others can raise funds more cheaply," a senior banker told the FE, requesting anonymity.
"Imposing a uniform spread across lenders could have unintended consequences, particularly for banks that rely on relatively expensive deposits to fund their loan portfolios."
The issue should instead be left to market forces, which would determine appropriate deposit and lending rates, he said.
Well-managed banks could attract deposits at lower costs, while weaker lenders would often have to offer higher rates to mobilise funds, the banker added.
Meanwhile, the spread between the weighted average deposit and lending rates of non-bank financial institutions (NBFIs) stood at 3.61 per cent in June.
The weighted average deposit rate was 10.14 per cent in the NBFIs, compared with a lending rate of 13.75 per cent.
