Mutual Trust Bank PLC (MTB) credits its ability to withstand recent turbulence in Bangladesh’s banking sector to a governance model rooted in compliance, transparency, merit-based decision-making and structured oversight.
Managing Director and CEO Syed Mahbubur Rahman emphasised that MTB’s strength lies in its institutional design rather than short-term adjustments, treating governance as a core operating principle rather than a mere compliance requirement.
“Governance is extremely important. We have always prioritised compliance and governance,” Rahman said.
Governance architecture and oversight layers
Rahman described MTB’s governance framework as a multi-layered system combining board oversight, risk governance and management execution. This ensures rigorous internal scrutiny before decisions are implemented.
The board risk management committee plays a central role in reviewing risks and guiding strategic direction, while a strong management committee facilitates structured internal debate before execution.
“We have a strong and active management committee where all decisions are discussed. We also have a strong board risk management committee where all issues are reviewed with board members,” he explained.
The relationship between the board and management is defined by full disclosure and transparency. “There is no gap between the board and management. We disclose everything transparently,” Rahman added.
MTB also maintains continuous transparency with Bangladesh Bank and other stakeholders, reinforcing accountability across all business environments.
Adaptation, technology and customer alignment
Beyond governance, Rahman highlighted MTB’s resilience through adaptation to technological and environmental change.
The bank has consistently embraced digital transformation as customer behaviour and banking channels have evolved.
“We have embraced technological transformation and adapted to changes in our environment,” he said. MTB also places strong emphasis on understanding customer needs through continuous research, using insights to redesign products and services.
Its research and development (R&D) function plays a forward-looking role in scenario planning, while partnerships with international institutions strengthen its grasp of global trends and benchmarks.
Measured growth over aggressive expansion
Rahman noted that MTB’s growth strategy has been deliberately conservative, prioritising sustainability and capital strength over rapid expansion.
“We have never been very aggressive. We maintained a moderate pace in line with market conditions and focused on sustainability,” he said.
Dividend distribution has been restrained to strengthen the balance sheet.
“In the last few years, we have not given more than 10 to 12 per cent dividend. We issued stock dividends because our objective has been to increase capital,” Rahman explained.
Depositor behaviour
Rahman observed that prolonged stress in the banking sector has reshaped depositor behaviour, with customers increasingly focusing on institutional strength, ratings and stability rather than interest rates alone.
“People are now asking whether they should look only at rates or at the strength and rating of a bank,” he said.
This shift has influenced fund movements across the system, including transfers between Shariah-based and conventional banks.
“I am even seeing customers move from Shariah-based banks to traditional banks,” Rahman noted, while adding that Islamic banking continues to hold structural opportunities for financially strong institutions.
Strategic foundation and performance
Rahman concluded that MTB’s resilience reflects a combination of governance discipline, compliance culture, transparency, structured risk oversight and long-term capital strategy.
MTB reported deposits rising 98 per cent over six years to around Tk37,460 crore as of March 2026, supported by a 15.2 per cent compound annual growth rate. It now ranks eighth among listed banks by deposit size.
Its capital-to-risk-weighted ratio stood at 13.6 per cent as of December 2025, while non-performing loans declined to 5.77 per cent from 7 per cent a year earlier.
“The key lesson from the sector’s turbulence is that governance, transparency and merit-based decision-making are not abstract principles but structural advantages that become most visible under stress conditions,” Syed Mahbubur Rahman said.
