Kamruzzaman Bablu :
Defaulted loans in banking sector is showing its upward trend in first quarter of the current fiscal mainly for weakness in evaluation process and dillydally by the authorities in recovery monitoring, sources said.
They said, weak management of loan recovery departments coupled with disbursement of loans without proper assessment, lack of risk evaluation of the concerned banks are main reasons behind the worsening situation.
According to official data, as of September 2016, the cumulative default loans of the banks stood at Tk 65,731 crore.
The figure also showed, default loans have increased by Tk 2,366 crore in first three months of this fiscal, most of which are from private and foreign banks.
Sources at the concerned department of Bangladesh Bank (BB) said, even loans regularized under special advantages have once again become defaulted.
Besides, defaulted loans are also rising because of reclassification of loans under a new system to keep pace with international banking regulations.
All banks have to keep required provisions against all disbursed loans. As a result interest rates for loans are not decreasing. Under these circumstances businessmen are facing hurdles. Former finance adviser to caretaker government Dr Mirza Azizul Islam on this issue said most banks are providing loans without the right procedure of evaluating.
Moreover, skipping the repayment of loans has become an evil culture in our country, he commented. He has further said it is happening due to poor implementation of laws. Directors of some banks pay loans to directors of other banks. Some loans are issued under political pressure. Mirza Azizul Islam has also remarked that if defaulted loans are allowed to increase in this way, it may lead to total disorder in the banking sector.
Amount of irrecoverable loans is also going up. General account-holders and depositors may face losses as a result of huge defaulted loans. He said Bangladesh Bank should take strong initiatives to stop the rising trend of defaulted loans and proper enforcement of law should be carried out as well.
Political influence on disbursement of loans needs to be stopped too, he said. “Good clients are getting negative indications about banking sector because of loan defaulters. Common people’s deposited money is being spent to write off bad loans.”
The total figure of defaulted loans by the end of September this year reached Tk 27,689 crore. In last June it was Tk 25,315 crore. It shows the amount of defaulted loans has increased by Tk 2,374 crore in last three months.
Meanwhile, foreign banks have defaulted loans of Tk 2,269 crore. However, defaulted loans of six state-run banks have slightly decreased. At present it is Tk 29,956 crore while at the end of June it was Tk 30,077 crore.
Defaulted loans in banking sector is showing its upward trend in first quarter of the current fiscal mainly for weakness in evaluation process and dillydally by the authorities in recovery monitoring, sources said.
They said, weak management of loan recovery departments coupled with disbursement of loans without proper assessment, lack of risk evaluation of the concerned banks are main reasons behind the worsening situation.
According to official data, as of September 2016, the cumulative default loans of the banks stood at Tk 65,731 crore.
The figure also showed, default loans have increased by Tk 2,366 crore in first three months of this fiscal, most of which are from private and foreign banks.
Sources at the concerned department of Bangladesh Bank (BB) said, even loans regularized under special advantages have once again become defaulted.
Besides, defaulted loans are also rising because of reclassification of loans under a new system to keep pace with international banking regulations.
All banks have to keep required provisions against all disbursed loans. As a result interest rates for loans are not decreasing. Under these circumstances businessmen are facing hurdles. Former finance adviser to caretaker government Dr Mirza Azizul Islam on this issue said most banks are providing loans without the right procedure of evaluating.
Moreover, skipping the repayment of loans has become an evil culture in our country, he commented. He has further said it is happening due to poor implementation of laws. Directors of some banks pay loans to directors of other banks. Some loans are issued under political pressure. Mirza Azizul Islam has also remarked that if defaulted loans are allowed to increase in this way, it may lead to total disorder in the banking sector.
Amount of irrecoverable loans is also going up. General account-holders and depositors may face losses as a result of huge defaulted loans. He said Bangladesh Bank should take strong initiatives to stop the rising trend of defaulted loans and proper enforcement of law should be carried out as well.
Political influence on disbursement of loans needs to be stopped too, he said. “Good clients are getting negative indications about banking sector because of loan defaulters. Common people’s deposited money is being spent to write off bad loans.”
The total figure of defaulted loans by the end of September this year reached Tk 27,689 crore. In last June it was Tk 25,315 crore. It shows the amount of defaulted loans has increased by Tk 2,374 crore in last three months.
Meanwhile, foreign banks have defaulted loans of Tk 2,269 crore. However, defaulted loans of six state-run banks have slightly decreased. At present it is Tk 29,956 crore while at the end of June it was Tk 30,077 crore.
