Kazi Zahidul Hasan :
Dishonest businessmen have misappropriated about Tk11,000 crore from five state-owned banks (SOBs) during the last six years, taking advantage of the banks’ poor oversight and weak credit risk management, sources said.
They have swindled the fund, constituting fake business entities and presenting forged documents of Sonali, Janata, Agrani, Rupali and BASIC Bank.
On top of this, default loan of the five state banks has also increased to an alarming level and many loans of the banks have been written off by this time, pushing them on the brink of collapse.
According to a report of Bangladesh Bank (BB), loan default of Janata Bank increased by 85 per cent, Sonali by 65 per cent, Agrani by 40 per cent and Rupali by 17 per cent during the last six years. Total loan default of these banks stood at Tk 19,000 crore. In addition, these banks wrote off loans worth Tk 15,000 crore.
“Indiscriminate loan sanctioning by the board of directors of these banks is the main cause behind their declining financial health,”
Dr AB Mirza Azizul Islam, former finance adviser of the caretaker government told The New Nation yesterday.
Besides, poor supervision and weak credit risk management of the banks has provided an extra advantage for the dishonest businessmen who swindled the fund from public banks, he added.
“Series of loan scandals occurred in public banks during the last six years. But the top management of these banks failed to prevent such occurrences raising question about their competency and honesty,” he said.
Referring to the loan scandals in BASIC Bank, Mirza Azizul Islam said, at the outset, the government had to dissolve the board of the bank on receipt of allegations of corruption and irregularities in loan sanctioning and misappropriation of funds by its chairman and board members.
Earlier, Bangladesh Bank (BB) found Tk 4,500 crore loan irregularities in the BASIC Bank.
“So, the main problem lies in the SOBs in its top management. Without a drastic overall in the area, the financial help of the public banks will not improve,” said Mirza Azizul Islam.
He suggested that the government should pick up efficient and knowledgeable persons in the boards of the state-run banks in a bid to infuse dynamism in their management. “Once an efficient and dynamic management is restored in these banks, they might overcome present deplorable condition,” he added.
“The board members should be made accountable regarding loan scandals, and penal action should be taken against them if they are found responsible in loan irregularities,” said Mirza Azizul Islam.
Financial health of the SOBs has deteriorated during the last six years mainly due to fund misappropriation by a group of dishonest businessmen and rising defaults loans in their overall credit portfolios,” said, Dr Khandoker Ibrahim Khaled, former BB Deputy Governor.
He said, during this time, there were two big financial scandals in Sonali Bank and BASIC Bank. Loan scams were also detected in Janata, Agrani and Rupali banks.
“The board of directors of the public banks miserably failed to run these banks mainly due to lack of banking knowledge and for political mindset,” he said, adding, “They also sanctioned loans on political consideration to a number of vested interest groups resulting in a sorry state of financial health of the five state-owned banks”.
Dr Akbar Ali Khan, former adviser of the caretaker government, said that political appointments in bank boards never produced a positive result.
“Problems of these banks lay in their administration. So, the government should look into the matter,” he said.
Dishonest businessmen have misappropriated about Tk11,000 crore from five state-owned banks (SOBs) during the last six years, taking advantage of the banks’ poor oversight and weak credit risk management, sources said.
They have swindled the fund, constituting fake business entities and presenting forged documents of Sonali, Janata, Agrani, Rupali and BASIC Bank.
On top of this, default loan of the five state banks has also increased to an alarming level and many loans of the banks have been written off by this time, pushing them on the brink of collapse.
According to a report of Bangladesh Bank (BB), loan default of Janata Bank increased by 85 per cent, Sonali by 65 per cent, Agrani by 40 per cent and Rupali by 17 per cent during the last six years. Total loan default of these banks stood at Tk 19,000 crore. In addition, these banks wrote off loans worth Tk 15,000 crore.
“Indiscriminate loan sanctioning by the board of directors of these banks is the main cause behind their declining financial health,”
Dr AB Mirza Azizul Islam, former finance adviser of the caretaker government told The New Nation yesterday.
Besides, poor supervision and weak credit risk management of the banks has provided an extra advantage for the dishonest businessmen who swindled the fund from public banks, he added.
“Series of loan scandals occurred in public banks during the last six years. But the top management of these banks failed to prevent such occurrences raising question about their competency and honesty,” he said.
Referring to the loan scandals in BASIC Bank, Mirza Azizul Islam said, at the outset, the government had to dissolve the board of the bank on receipt of allegations of corruption and irregularities in loan sanctioning and misappropriation of funds by its chairman and board members.
Earlier, Bangladesh Bank (BB) found Tk 4,500 crore loan irregularities in the BASIC Bank.
“So, the main problem lies in the SOBs in its top management. Without a drastic overall in the area, the financial help of the public banks will not improve,” said Mirza Azizul Islam.
He suggested that the government should pick up efficient and knowledgeable persons in the boards of the state-run banks in a bid to infuse dynamism in their management. “Once an efficient and dynamic management is restored in these banks, they might overcome present deplorable condition,” he added.
“The board members should be made accountable regarding loan scandals, and penal action should be taken against them if they are found responsible in loan irregularities,” said Mirza Azizul Islam.
Financial health of the SOBs has deteriorated during the last six years mainly due to fund misappropriation by a group of dishonest businessmen and rising defaults loans in their overall credit portfolios,” said, Dr Khandoker Ibrahim Khaled, former BB Deputy Governor.
He said, during this time, there were two big financial scandals in Sonali Bank and BASIC Bank. Loan scams were also detected in Janata, Agrani and Rupali banks.
“The board of directors of the public banks miserably failed to run these banks mainly due to lack of banking knowledge and for political mindset,” he said, adding, “They also sanctioned loans on political consideration to a number of vested interest groups resulting in a sorry state of financial health of the five state-owned banks”.
Dr Akbar Ali Khan, former adviser of the caretaker government, said that political appointments in bank boards never produced a positive result.
“Problems of these banks lay in their administration. So, the government should look into the matter,” he said.
