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The excess liquidity has started declining soon after the BB commenced mopping up surplus funds from the banking system.

“The indicators of the financial sector have given a ray of hope that the banking sector will soon return to the prosperity that it had enjoyed before the pandemic,” Ahmed said. Md Arfan Ali, managing director of Bank Asia, said the deposit growth in the last fiscal year was not unusual as the banking industry usually enjoyed 2-3 per cent growth per year.

However, the declining lending growth was not a regular phenomenon, he said, adding that the credit demand had picked up in the last couple of months.

“The demand for both taka and the US dollar has recently increased to a large extent. As a result, the banking industry will be able to recover from the ongoing slowdown quickly.”

Among all lenders, Islami Bank Bangladesh disbursed the highest amount, at Tk 100,400 crore in FY21.

Sonali Bank secured the top position when it comes to deposit mobilisation, collecting Tk 132,798 crore.