bdnews24.com :
A staggering 88 percent of the total loan disbursed by banks in Bangladesh is frighteningly concentrated in just 4 percent of the borrowers.
Bangladesh Economic Association President Ashraf Uddin Chowdhury revealed the information at a pre-budget discussion held on Sunday with the finance minister in the chair.
The minister, however, says he cannot change depressing picture.
Chowdhury said: “I’ve found in a study that 70 percent of the borrowers receive a little over 2 percent of the loans disbursed by the banking sector.”
“Only 4 percent get 88 percent of the loans. It means 96 percent borrowers get roughly 12 percent of the loans,” he added.
Finance Minister Abul Maal Abdul Muhith agreed with the study findings but pleaded his inability to tackle the problem.
“I don’t know how we can come out of the problem,” he said.
Muhith described the imbalanced loan proportion as ‘the main problem’ in the banking sector.
After the meeting, Chowdhury told bdnews24.com by telephone: “Out banking sector will face disaster unless we can come out of this terrible situation.”
He said he had conducted the study to publish a journal for state-owned Janata Bank Ltd.
Chowdhury, who teaches at Dhaka University, was happy that the finance minister agreed with his finds.
He urged the government not to be confined only to ‘agreement’ and take urgent measures to tackle the problem.
Chowdhury said: “Most of the 4 percent people who hold 88 percent of loans are influential. Their loans are defaulted on for years on end. Banks can’t get the money back. There is doubt if (the loans) will be realised at all.”
In his introductory speech at the discussion, the finance minister said violence over the past three months ruined the possibilities of the economy growing at 7 percent. He said: “Until December, when we calculated (the growth rate), we were certain that a 7 percent growth will be attained this fiscal year. But the three months of shutdowns and general strikes enforced by the BNP-led alliance have damaged the economy a lot.
“We’re now sceptical of having a 7 percent growth.”
The government in its budget had projected a 7.3 percent GDP growth for the current 2014-15 fiscal year that began on July 1.
A staggering 88 percent of the total loan disbursed by banks in Bangladesh is frighteningly concentrated in just 4 percent of the borrowers.
Bangladesh Economic Association President Ashraf Uddin Chowdhury revealed the information at a pre-budget discussion held on Sunday with the finance minister in the chair.
The minister, however, says he cannot change depressing picture.
Chowdhury said: “I’ve found in a study that 70 percent of the borrowers receive a little over 2 percent of the loans disbursed by the banking sector.”
“Only 4 percent get 88 percent of the loans. It means 96 percent borrowers get roughly 12 percent of the loans,” he added.
Finance Minister Abul Maal Abdul Muhith agreed with the study findings but pleaded his inability to tackle the problem.
“I don’t know how we can come out of the problem,” he said.
Muhith described the imbalanced loan proportion as ‘the main problem’ in the banking sector.
After the meeting, Chowdhury told bdnews24.com by telephone: “Out banking sector will face disaster unless we can come out of this terrible situation.”
He said he had conducted the study to publish a journal for state-owned Janata Bank Ltd.
Chowdhury, who teaches at Dhaka University, was happy that the finance minister agreed with his finds.
He urged the government not to be confined only to ‘agreement’ and take urgent measures to tackle the problem.
Chowdhury said: “Most of the 4 percent people who hold 88 percent of loans are influential. Their loans are defaulted on for years on end. Banks can’t get the money back. There is doubt if (the loans) will be realised at all.”
In his introductory speech at the discussion, the finance minister said violence over the past three months ruined the possibilities of the economy growing at 7 percent. He said: “Until December, when we calculated (the growth rate), we were certain that a 7 percent growth will be attained this fiscal year. But the three months of shutdowns and general strikes enforced by the BNP-led alliance have damaged the economy a lot.
“We’re now sceptical of having a 7 percent growth.”
The government in its budget had projected a 7.3 percent GDP growth for the current 2014-15 fiscal year that began on July 1.
