Perilously the newly formed Board has approved loans to clients without obeying proper rules, regulations and procedure. Even in some instances, the Board has not paid heed to objections raised by the Bangladesh Bank (BB) observer at the bank. The change over that was apparently implemented in questionable circumstances has now allowed vested interest quarter the opportunity to take loans against objectionable projects or getting approval of loans and transferring money to third bank which may make money untraced at the end.
A well managed bank seems to be heading towards mismatch and if the central bank does not come forward to strictly enforce good lending practice, it may eventually become one more banks laundered by dishonest people like BASIC Bank now on surviving with government recapitalization or Sonali Bank, Agrani Bank, Agricultural Bank and such others which have lost much of their capital through laundering by powerful people only to move out the money abroad. The fact is that none but the IBBL management can save the bank but the question is will it?
As per central bank’s disclosure the bank’s Board approved loans worth Tk 16.75 crore to two clients — JN Flour Mills and its associated organization. The approval came at a meeting on February 16 and the loan was disbursed from the bank’s Bahaddarhat branch in Chittagong while the mills of the client is located at Laksam in Comilla. Moreover, the loan was transferred through Khatunganj branch of Al-Arafah Islami Bank. Insiders say such mismatch was unthinkable since its inception in 1982. It is unclear under what circumstances the client has agreed to transfer the loan from one bank to another and whether the acquisition of loan was lawful. Many fear that the money may be diverted to unspecified projects at the end.
In another incident, the IBBL Board has approved loan for HBC Bricks, a client of its Companyganj branch in Comilla without verifying the credit worthiness of the client. The client has no environmental clearance but the Board approved the loan despite objection from central bank’s observer at the bank. The Khatunganj branch of Islami Bank also acquired all non-funded liabilities of another trading house from the branch of Exim Bank. The Board gave nod to another loan proposal of Tk 132.60 crore to another industry – a new client at the branch without proven credibility. The loan proposal even did not include information about the client’s banking activities. We must say playing with depositors money in banks is a crime and it must be stopped before too late.
