A news report on Monday said write-off bad loans have continued to swell with a declining trend in recovery compounded by irregularities in disbursement, which have eventually led to a rise in defaulted amounts. According to a Bangladesh Bank data, in the first nine months of 2021, banks removed around Tk 974 crore from their balance sheets and recovered only Tk 472 crore. Since the write-off facility was introduced in 2003, lenders have written-off Tk 57,975 crore till September last year, which is 57.31 per cent of the total defaulted loans in the banking sector.
Economists and bankers said the major reason behind the default loan is the distribution of credit on political considerations, which made it quite difficult to recover. A large number of habituated defaulters affiliated with political parties take loans and the banks failed to recover them. Besides political affiliation, the experts blamed the culture of impunity, abuse of power in loan disbursement, weakness of existing laws and lack of technical expertise that help defaulters swindle money from banks. The vested quarters are manipulating existing laws to take loans and turn into defaulters. If the defaulters are sued, they file writ petitions against banks. When the court rejects the appeal, they can file the writ again. This is a hindrance towards recovering default loans.
Indeed, default loans hit the banks’ profit, shrink the scope of business expansion and thwart plans for job creation. On top, banks’ costs of funds rise while lending rates go higher and the deposit interest rates go down. Equally, the government also injects crores of taka as recapitalisation funds into the state-owned banks; all of it was the taxpayers’ money. There has also been demand in the financial sector to bring accuracy, accountability and good governance as well as to rein in the loan default culture. But good governance will not be fully established unless people like former BASIC Bank chairman Sheikh Abdul Hye Bacchu and PK Halder, who laundered several thousand crores of taka abroad, are punished for their corruption.
Most big defaulters enjoy favour of government because the educated bankers love to be obedient to the government. They have no conscience to understand that they cannot play political game with public money. Our people are unlucky to have anti-people educated people, corrupt and selfish. No country cannot be right where educated ones are opportunists.
