Sonali Bank (UK) Limited has closed three out of five branches due to continuous losses.
The branches–Luton, Camden and Bradford–were closed in 2016, according to Bangladesh Bank (BB).
“Continuous losses by these branches and reducing the risk of facing regulatory issues were main reasons for the closure, “ a BB official told The New Nation yesterday.
He said, not only these branches, even the overall operation of the bank has gone into losses due to bad governance and anomalies.
Two other branches– London and Birmingham–however remain operative, said the official.
Recently, the UK’s Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) asked the Sonali Bank (UK) Limited (SBUK) to ‘wind down’ its business for several anomalies including lack of internal control and anti-money laundering activities and poor risk management.
The bank’s net loss stood at £296,006 in 2016 and £1,532,910 in 2015, according to an official figure. It also incurred losses in 2006,2009 and 2010.
Officials attributed the bank’s operating losses to improper business plan, excessive operating expenses and inefficiently of the senior officials.
Even, the bank has to accommodate huge expenses to hold a board meeting.
The board of SBUK consists with eight members. Of them, four are Bangladeshi government officials and four others are British.
Former Secretary of Bank and Financial Institution Division (BFID) Dr S Aslam Alam and Sonali Bank Bangladesh Limited’s Managing Director Md. Obayed Ullah Al Masud are among the board members.
The bank’s operating expenses stood at £6,143,314 in 2016, while it stood at £4,780,896 in 2015.
Sonali Bank (UK) Limited was established in 2001 to render wholesale banking to Bangladeshi banks and retail banking services to the Bangladeshi Community living in the UK.
Sources said despite having huge potential, the bank has failed to expand its business due to absence of much needed dynamism within the board. Directors of the bank’s board are busy with their personal agenda rather crafting business plan.
