The Bangladesh Bank has reached a final agreement with the International Monetary Fund (IMF) for the disbursement of the fourth and fifth tranches—amounting to $1.3 billion—from the $4.7 billion loan package approved in 2023.
The funds are expected to be released in June 2025, following the completion of a review conducted in April and subsequent approval by the IMF Executive Board, according to officials at the central bank.
This agreement follows a series of high-level meetings between IMF and Bangladesh Bank officials, which addressed a long-standing dispute over the implementation of greater exchange rate flexibility.
The multilateral lender had previously withheld the fourth tranche, worth $645 million, due to concerns about the lack of progress on reforms, particularly the adoption of a crawling peg system and the elimination of multiple exchange rate windows.
A senior Bangladesh Bank official confirmed that the IMF has now agreed to release the combined disbursements after the central bank committed to a more flexible exchange rate regime.
While the Washington-based lender had pushed for a truly market-driven exchange rate—beyond limited corridor adjustments—the central bank maintained a cautious stance, citing risks of inflationary shocks and possible political resistance.
To formally announce the development, the Bangladesh Bank has scheduled a press conference on Wednesday at its headquarters.
An IMF staff mission, led by Chris Papageorgiou, visited Dhaka from 6 to 17 April to conduct the combined third and fourth reviews of Bangladesh’s reform programme under the Extended Fund Facility (EFF), Extended Credit Facility (ECF), and the Resilience and Sustainability Facility (RSF).
According to central bank officials, the review focused heavily on key structural reforms, including banking sector resilience, revenue mobilisation, and external sector stability. Exchange rate reform remained the most contentious issue, with the IMF emphasising the need to dismantle the existing fragmented foreign exchange framework in favour of a unified, flexible regime aligned with market conditions.
Bangladesh has already received three instalments totalling $2.3 billion under the loan programme. However, the fourth instalment was delayed after negotiations broke down in February 2025.
At the time, the Ministry of Finance clarified that the delay was due to the need to meet specific conditions that were previously agreed upon with the IMF as part of the broader effort to strengthen the country’s economic foundations.
The ministry later confirmed that both parties had agreed to combine the fourth and fifth tranches into a single disbursement in the fiscal year 2024–25. This arrangement was intended to allow more time for the implementation of key reforms tied to budget support and macroeconomic stability.
The combined disbursement of $1.3 billion, now scheduled for June, will follow the final approval of the IMF Board. The deal marks a significant step for Bangladesh as it seeks to stabilise its economy amid external pressures, a widening current account deficit, and currency volatility.