The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) Financial Sector Support Project (P150938) SOUTH ASIA | Bangladesh | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2015 | Seq No: 11 | ARCHIVED on 24-Feb-2021 | ISR45559 | Implementing Agencies: The People's Republic of Bangladesh, Bangladesh Bank Key Dates Key Project Dates Bank Approval Date: 05-Jun-2015 Effectiveness Date: 20-Sep-2015 Planned Mid Term Review Date: 19-Mar-2018 Actual Mid-Term Review Date: 19-Mar-2018 Original Closing Date: 30-Sep-2020 Revised Closing Date: 31-Mar-2021 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to improve financial market infrastructure, regulatory and oversight capacity of Bangladesh Bank and access to long term financing for private firms in Bangladesh. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Strengthening Financial Market Infrastructure:(Cost $38.50 M) Strengthening Regulatory Capacity:(Cost $5.00 M) Supporting Long Term Finance:(Cost $304.00 M) Project Implementation and Monitoring:(Cost $2.50 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions The project implementation is progressing well, with procurement activities now completed and disbursement of project funds at 91 percent. The Project Development Objective (PDO) remains relevant and supports three main areas of the project: (i) financial infrastructure, (ii) regulatory and supervisory reform, and (iii) advancement of long-term finance. While good progress is achieved in most of the areas, Bangladesh Bank has committed to undertake additional reforms to increase compliance with 3 outstanding result indicators and achieve PDO. It is expected that all the project activities will be completed by the project closing date of March 31, 2021. 2/24/2021 Page 1 of 6 The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance High High High Macroeconomic Moderate Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Moderate Moderate Moderate Sustainability Fiduciary Substantial Moderate Moderate Environment and Social Moderate Substantial Substantial Stakeholders Low Low Low Other -- Substantial Substantial Overall Moderate Moderate Moderate Results PDO Indicators by Objectives / Outcomes Improve financial sector efficiency IN00955470 ►Percentage of Government Payments by value processed through electronic means (annually) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 10.00 73.00 98.20 40.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 IN00955566 ►Uptime of the total core systems of the BB - core banking, payment systems, credit reporting system, and MI module (%) (Percentage) These indicators measure IT infrastructure capacity. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 95.00 95.00 97.00 98.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 IN00955567 ►Performance on BCP assessment: Number of principles on which Bangladesh Bank is judged as largely compliant and compliant. (Number, Custom) 2/24/2021 Page 2 of 6 The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) Baseline Actual (Previous) Actual (Current) End Target Value 4.00 5.00 5.00 8.00 Date 30-Sep-2009 01-Jul-2020 30-Nov-2020 31-Mar-2021 5 Compliant. This has been revised in the aftermath of the FSAP. The end target will be assessed Comments: in a year with an independent review. IN00955568 ►Outstanding FX Long term loans of Participating Financial Institutions (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 300.00 780.00 852.00 550.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 Intermediate Results Indicators by Components Strengthening Financial Market Stability, Inclusion, and Long Term Finance IN00955569 ►High level of operational reliability as measured by improved compliance of BB with the Principle 17 of the CPSS – IOSCO Principles for Financial Markets Infrastructure (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N/A Partially observed Partially observed Observed. Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 Bangladesh Bank (BB) is achieving increased compliance with Principle 17 of Financial Market Infrastructure, which refers to operational risk. A Business Continuity Plan (BCP) is already developed and BB is currently conducting self-assessment of key payment platforms such as Real Comments: Time Gross Settlement System (RTGS). More work regarding operational risks will be completed by the end of the project. IN00955570 ►Cumulative number of Bangladesh Bank banking supervision officers trained on risk-based supervision (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 323.00 370.00 300.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 The supervisory firm has done a very good job of training front-line supervisors in international best practices. the supervisors have been trained in assessing the capital adequacy, the liquidity, Comments: the quality of loan portfolio, and efficiency of the banks. The cumulative number of Bangladesh Bank banking officers trained on risk-based supervision has already increased from 180 to 323. IN00955571 ►Circular on prompt corrective action issued by BB (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 2/24/2021 Page 3 of 6 The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) Value No Not initiated Not initiated Circular issued Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 Bangladesh Bank authorities say that sanctioning procedures already exist in their current rules. There is lack of enforcement and reluctance to take corrective action. Department of off-site supervision has 'Problem Bank Monitoring Section' and 'Observer Cell' to take prompt corrective Comments: actions for banks which have deficiency in 'Corporate Governance' and/or which have CAMELS rating less than or equal to 4. IN00955572 ►Direct project beneficiaries (firms) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 53.00 54.00 55.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 IN00955573 ►NPLs in project-funded in foreign-denominated long-term finance portfolio (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 7.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 The team is monitoring the situation as there is evidence of a slight increase in the NPLs of two of Comments: thirty one PFIs. The team is awaiting June data from Bangladesh Bank. IN00955574 ►Number of PFIs (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 31.00 21.00 10.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 IN00955575 ►Cumulative number of FI officers receiving training or attending workshops on risk management, safeguards, and commercial practicesin procurement (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 254.00 261.00 45.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 Based on market demand for the workshops and prevailing conditions BB trained more than the target. Also, the number of PFIs has increased from 10 to 31 which added more participants. Comments: IN00955576 ►Cumulative number of participants and trainees at Training Of Trainers (TOT) and other workshops delivered to industry on safeguards and health and safety (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target 2/24/2021 Page 4 of 6 The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) Value 0.00 66.00 55.00 50.00 Date 30-Sep-2014 01-Jul-2020 30-Nov-2020 31-Mar-2021 A number of trainings on safeguards are planned for the fall, but this will depend on the unfolding Comments: of the covid pandemic. IN00955577 ►Direct project beneficiaries (firms and PFIs) that feel project financing reflected their needs (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 92.00 92.00 75.00 Date 30-Sep-2014 31-Jan-2019 30-Nov-2020 31-Mar-2021 The survey feedback from beneficiaries was completed in January, 2019. The results show a high percent of companies and PFI's that are content with the long-term financing instrument. A new Comments: survey will be completed by the end of the year. Performance-Based Conditions Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P150938 IDA-56640 Effective USD 300.00 300.00 0.00 273.27 24.18 92% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P150938 IDA-56640 Effective 05-Jun-2015 30-Jun-2015 20-Sep-2015 30-Sep-2020 31-Mar-2021 Cumulative Disbursements 2/24/2021 Page 5 of 6 The World Bank Implementation Status & Results Report Financial Sector Support Project (P150938) PBC Disbursement Achievement Disbursed amount in Disbursement % PBC ID PBC Type Description Coc PBC Amount Status Coc for PBC Restructuring History Level 2 Approved on 23-Oct-2019 ,Level 2 Approved on 27-Feb-2020 Related Project(s) There are no related projects. 2/24/2021 Page 6 of 6