NEWS report on Thursday in a national daily said Bangladesh Bank has asked newly licensed Farm Bank Ltd to remove the chairman of its Executive Committee (EC) Md Mahabubul Haque Chisty for loan irregularities covering disbursement of Tk 50 crore. The central bank has reportedly given it only 10 days to remove the EC chairman in a letter to the bank chairman Mohiuddin Khan Alamgir on May 17. The country witnessed big loan scandals in the recent past involving both public and private sector banks; and the disclosure of yet another loan scandal involving a newly licensed private bank just shows that dishonest people are not sitting idle folding their hands crosses. It appears that Bangladesh Bank has acted quickly this time in the light of its recent experiences in which banks, mostly public sector banks, lost over Tk 10,000 crores to swindlers. It is obviously an appreciable step.
Allegations against Mr Chisty showed he was directly responsible for irregularities in the loan sanctioning. In some cases, he passed the loans without taking the approval of the EC committee, in other cases he did not seek recommendation of the EC and in yet other cases he sidetracked recommendations of the branches; which would provide the loans. The central bank had earlier issued show cause notice on Mr Chisty who confessed his failure in reply to the allegations taking all blames on him.
Most of these loan irregularities were earlier detected by Bangladesh Bank’s inspection teams at Gulshan and Motijheel branches; which visited in November last year. The findings showed he sanctioned these loans indiscriminately at his will and since he was aware of the breach of safety rules, definitely he may have mala fide intentions behind it. Particularly the bank chairman is not someone to be misled. What is more worrisome is that banks behold depositors’ money, besides handling government fund and any vulnerability of the deposits will be highly catastrophic.
It may be recalled that Sonali Bank alone lost over Tk 3,600 crore in fictitious loans in which bank’s chairman, several politically appointed directors and some of its senior officials were involved. BASIC Bank lost over Tk 4,500 crore while some other losers to swindlers included Agrani Bank, Janata Bank, Rupali Bank and Agricultural Bank.
The money is almost totally lost without chance of recovery. It is advisable that the central bank must sternly deal with any one misusing position in bank management. It should also further strengthen its inspection regime in all banks and expand watch on the handling of loan portfolios by directors and such others using their political identity. Banks must be protected to protect people’s interest.
