The central bank has directed the BASIC Bank authorities to take stern action against its corrupt officials who had helped a vested quarter to swindle out Tk 4,500 crore from the bank.
Bangladesh Bank (BB) governor Dr Atiur Rahman issued the directive when the newly appointed members of the Basic Bank’s board of directors led by its chairman Alauddin A Majid called on him at BB headquarters on Sunday.
“The central bank has issued an 11-point directives to the new BASIC Bank board asking it to implement those in an urgent basis,” said BB executive director SM Moniruzzman at a media briefing after the meeting.
He added: These directives were issued to improve the financial health of the state-owned bank. The financial health of the bank continued to deteriorate in the wake of corruption and irregularities in loan disbursement.
Earlier on July 6, the government dissolved the seven-member BASIC Bank board and appointed Alauddin A Majid as its chairman apparently to comply with the central bank recommendation. Later, it also appointed four new directors for the bank.
The board of the bank has been dismissed for its role in financial irregularities that cost the state-run bank Tk 4,500 crore in the last four years. The loan scams were earlier detected by the central bank investigation.
“BB has asked the new BASIC Bank board to identify its corrupt officials who were loyal to the former chairman and managing director,” said the BB official, adding that BB wants stern action against these corrupt officials for their nexus with the high-ups of the former board to misappropriate the bank money.
Apart from this, BB also asked the board for taking proper and necessary steps to restore lending discipline of the bank, bring back confidence of the investors and depositors, strengthen activities of the bank’s taskforce formed to recover bad and classified loans and ensure accountability and transparency of the bank’s board.
“We have asked the Bank authorities to intensify monitoring on the overall activities of some of its branches where the BB earlier detected huge loan scams,” he said, adding, “BB has asked to take stringent measures to establish internal control over the branches as well as to restore discipline in their lending activities.
BB has suggested the board for taking cost cutting measures to make the branches operationally viable, he said.
As the BB earlier found huge irregularities in the bank’s recruitment and promotion process, it also asked the bank to ensure accountability and transparency in these processes. Besides, the board has been asked to make the bank’s Executive and Audit Committee more effective by holding regular meetings with them time to time.
He also said that the new board of directors has also asked to take necessary steps to recover Tk 4,500 crore that was stolen from in its three branches.
