Country’s bank directors and miscreants under the political shelter are allegedly misappropriating a huge amount of loans every year. Not only the public but also the private banks are facing this dilemma. The wrongdoers normally use fake names and Ids while opening FDRs in banks with an ill motive taking loans against them. They withdraw a big chunk of money against the FDRs and swindled them abroad.
In view of this fact, experts have termed the bank directors’ mismanagement, inefficiency and political influence as responsible for the corruption in the banking sector. The central bank along with other public and private banks should come forward and take stern actions against the loan scam. Many banks were also blamed for recruiting directors and high officials without maintaining proper rules and regulations.
Meanwhile, Bangladesh Bank has sent a draft proposal for amendment of the Bank Company Act to the Bank and Financial Institution Division (BFID) under the Ministry of Finance with a view to restore discipline in banking sector. The BFID also gave it to its website seeking suggestions from people of all strata. Around one hundred individuals and institutions have given their opinions on the proposal. They suggested that a person who had whitened black money by paying 10 per cent extra tax should not be made a bank’s director.
Experts suggested that since 92 per cent is the depositors’ money and only 8 per cent of the bank directors, so strict laws be made and their implementations are urgently needed to protect the depositors’ interests. If the bank directors are truly professional, experienced and honest, that bank will run smoothly. In any way, bank directors must not be made because of their family connection or being relatives.
They also suggested that none could be made bank director without having minimum ten years of banking experience. Like the managing directors, bank’s director should also face exams. As a result, their accountability will be enhanced.
Though demand for formation of a banking commission at different times brought to the issue, the government gave its proponents the cold shoulder, maintaining its usual indifference to a deepening crisis in the country’s banking sector. The Centre for Policy Dialogue (CPD), a private think tank, has also spoken out about the urgency of streamlining the banking sector. It also wants the proposed commission to be fully independent.
Since professional and honest directors form an integral part of good governance in banking sector, it is not only important but also essential to select directors duly complying with the banking rules and regulations by the central bank.
