People’s Leasing and Financial Services (PLFS) Limited has received around Tk 5 crore from borrowers in five months since the government’s approval for the liquidation of the ailing non-bank financial institution.
The borrowers of PLFS have provided the amount voluntarily as the liquidator, appointed by the court, is yet to launch drive for the recovery of defaulted loans.
Of the Tk 1,131 crore outstanding loans of PLFS, Tk 748 crore or 66.14 per cent of the total loans has become non-performing loans.
The finance ministry on June 26 this year allowed the Bangladesh Bank to go for liquidation of PLFS due to the entity’s failure in repaying depositors’ money following massive irregularities in loan disbursement.
Based on approval from the finance ministry and subsequent approval from the High Court, the central bank started the process of liquidation of PLFS.
Md Asaduzzaman Khan, BB deputy general manager and also the liquidator appointed by the court, told New Age on Tuesday, ‘Measures would be taken for the recovery of defaulted loans once the audit is completed.’
‘Measures cannot be taken to recover money from any borrower unless we know the exact claim of PLFS to the defaulters,’ he said.
The exact claim amount to any defaulter can be known after the completion of audit, he said.
In August 25, the BB appointed an audit firm, Acnabin Chartered Accountants, to conduct a special audit in PLFS as per the regulatory requirement.
The audit would cover activities of the entity for the period between September, 2015 and 2019.
Meanwhile, the BB in November issued a letter to the chartered accountancy firm to complete the auditing of People’s Leasing by December this year as many of its depositors were in dire need for money.
To conduct day-to-day liquidation function, the liquidator has appointed 20 persons at PLFS, Asaduzzaman said.
Once the audit report is submitted by the auditor, an extensive recovery drive would be launched to recover the money, he said.
Meanwhile, several borrowers have been paying instalments on voluntary basis and the recovered amount has exceeded Tk 5 crore, he said.
Depositors of PLFS have already met finance minister AHM Mustafa Kamal and BB governor Fazle Kabir and demanded payment of their money that they kept with PLFS by December this year.
Neither the finance minister nor the BB governor specified any deadline for repayment of money but assured them of quick payment of money.
Liabilities of People’s Leasing would be higher than the assets of the entity once its previous years’ losses and deferred expenses are excluded from its assets.
Assets of People’s Leasing would reduce by at least Tk 1,725.3 crore from Tk 3,263.25 crore shown in its financial statements, according to the entity’s annual reports for the year of 2017.
If the amount is deducted from the assets, PLFS assets would decline to Tk 1,537.65 crore, Tk 498 crore lower than the entity’s liabilities Tk 2,036 crore.
Whether the government would contribute any fund to settle the depositors’ claim is yet to be clarified by the government.
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