The visiting International Monetary Fund officials on Monday expressed concern over the growing non-performing loans in the state-owned commercial banks in absence of good governance, at a meeting with officials of Financial Institution Division.
Officials attending the meeting said that the IMF officials asked them why there was no improvement in checking the high growth in bad loans.
They also said IMF took note about the appointment of representatives to the boards of directors of the SCBs and ratio of private representatives and public officials in the boards.
Newly appointed secretary of the division Ashadul Islam led the Bangladesh side that discussed the profitability, capital adequacy and liquidity situation of SCBs in the meeting, added the officials.
Led by Daisaku Kihara, the IMF team that is assessing the overall performance of the state-owned commercial banks has already met with Bangladesh Bank, regulators of the country’s banking sector.
Officials said IMF officials for the first time inquired about the performance of private banks including scam-hit Farmers Bank during their parley with the BB officials.
Bad loans in five state-owned banks including the scam-hit ones soared by 22 per cent in the first six months of the current year due to poor recovery.
Officials said bad loans in Sonali, Agrani, Janata, Rupali and BASIC stood at Tk 44,904 crore as of June 30, 2018, rising from Tk 36,626 crore as of December 31, 2017.
Sonali Bank which suffered a loss of over Tk 3,600 crore to little known Hallmark Group due to scam in 2013 is carrying the highest amount of bad loans — Tk 13,174 crore — as of June, 2018.
The data prepared by the FID also shows that Janata has the second highest — Tk 9,702 crore — bad loans following Tk 1,200 crore loan scam by Bismillah Group in 2012 and recent disclosure of loan scams by AnonTex and Crescent Group.
Once profitable, BASIC Bank has defaulted loans worth Tk 8,443 crore following extension of Tk 6,000 crore fictitious loans by the previous board of directors led by politically appointed chairman Sheikh Abdul Hye Bacchu.
Bacchu still goes scot-free as the Anti-Corruption Commission has failed to bring any charge against him although the central bank in its investigation has found his involvement in the extension of huge amount of shady loans in 2009-2014.
Agrani Bank has defaulted loans of Tk 8,678 crore while the amount is Tk 4,907 crore in Rupali Bank.
Banking experts have been criticising the government for political intervention in operation of the state-owned banks resulting in random loan scams and high growth of defaulted loans in the last several years.
They said the memorandum of understandings (MoUs) signed between SCBs and the FID became just eyewash as most of the indicators like recovering bad loans as per MoUs were yet to be implemented.
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