‘Fake’ directors, Tk 701cr shady loans: scams galore in NRBC

AKM Zamir Uddin | Published: 23:45, Jan 30,2017 | Updated: 21:11, Dec 10,2017


A file photo shows the principal branch of NRB Commercial Bank in Dhaka. Bangladesh Bank has found that the board of directors of recently-established NRB Commercial Bank was engaged in massive irregularities — from forging signatures of directors to sanctioning Tk 701 crore in loans flouting rules and regulations. — New Age photo

Bangladesh Bank has found that the board of directors of recently-established NRB Commercial Bank was engaged in massive irregularities — from forging signatures of directors to sanctioning Tk 701 crore in loans flouting rules and regulations.

A number of BB inspections conducted between June, 2016 and December 2016 found that the private commercial bank showed in its documents presence of four directors, all non-resident Bangladeshis, in its board meetings held during 2013-2016 although they were actually not in the country during that period.

The government approved the bank in 2013 with the aim of attracting investment from NRBs to the bank.

According to the central bank’s investigation reports submitted on December 15, 2016, the four directors — Kamrun Nahar Sakhi, ABM Abdul Mannan, Firoz Haider Khan and Md Amir Hossain — had been shown present in the board meetings by ‘forging signatures’.

Even, the signatures shown as the signatures of the directors in the papers of board and executive meetings did not match with their (four directors) signatures in the other bank documents and article of association, said the reports.

The BB investigations found that there was no document like photocopies of passports that supported that Sakhi, Firoz, Mannan and Amir came to Bangladesh to attend the meetings in the period.

Sakhi declared in her business statement that she had been living in Canada while Mannan said that he had been residing in the USA for long.

But, the two persons sent money to purchase their shares in NRBC Bank from Dubai of the United Arab Emirates through Wall Street Exchange, the inspection reports said.

BB officials said that it was abnormal that the two persons sent the money from the UAE.

Sakhi was also a ‘loan defaulter’, but NRBC Bank appointed her as a board member of the bank concealing the loan defaulting information.

New Age has obtained copies of all reports on investigations conducted by four separate teams of the BB at the bank’s head office, principal branch, Gulshan branch and Dhanmondi branch.

According to the BB probe reports, Mercantile Bank chairman Shahidul Ahsan actually holds ‘illegally’ the shares which are documented as shares held by NRBC Bank directors Shaki and Mannan and M Rahman Steel Mills Ltd managing director Maksudur Rahman holds the shares shown as shares held by director Amir.

New Age earlier on December 26, 2016 reported how Shahidul Ahsan grabbed the bank’s shares worth Tk 43.71 crore and how the bank sanctioned Tk 301 crore in loans to him (Ahsan) violating the single borrower exposure limit.

Ahsan, however, denied any wrongdoing in a rejoinder which was published in the January 3 issue of New Age.

Regarding the shady holding by Maksudur, the BB probe found he opened ‘fake’ accounts with Gulshan branches of Mercantile Bank and NRBC Bank in the name of Amir, the BB reports said.

Maksudur is the real owner of Amir’s shares worth Tk 20 crore in NRBC Bank.

Maksudur sent money from Atlanta of the United States to purchase the shares of the bank in Amir’s name.

Maksudur is a member of the board of directors of newly-established South Bangla Agriculture and Commerce Bank Ltd. He is also chairman of the risk management committee of the bank’s board.

When New Age contacted Maksudur over mobile phone on Sunday, he said, ‘I have no connection with Amir. I did not hold any illegal shares in NRBC Bank.’

He said, ‘My opponents are trying to tarnish my image.’

On Sunday, in a reply to a question from reporters at the unveiling session of the monetary policy statement, BB deputy governor SK Sur Chowdhury said that the central bank would take punitive measure against anyone who holds illegal shares in other banks.

‘The central bank is now investigating NRBC the matter. The BB will take proper measure after completing the inspection process,’ he said.

Regarding shady loan disbursements, the BB reports showed that NRBC Bank disbursed Tk 3 crore to Ornita Agro on April 22, 2014 and the fund was transferred to an organisation named IPE Capital.

Former NRBC Bank board member Adnan Imam was the owner of IPE Capital meaning that the bank disbursed the loan to its own director violating rules.

The principal branch of the bank disbursed Tk 22.32 crore to Multiplan Development Ltd and NRBC board member Syed Munsif Ali was one of the beneficiaries of the organisation.

The bank sanctioned a credit limit of Tk 15 crore to Multiplan on August 8, 2013 to build two separate buildings at west Agargaon in Dhaka.

The bank raised the credit limit to Tk 18 crore on September 17, 2014 despite the fact that the loan became a classified one under the substandard category.

The bank’s managing director later increased the tenure of the loan without placing the proposal before the credit committee of the bank so that the loan could not be shown as a defaulted one.

The outstanding loan with Multiplan stood at Tk 22.32 crore on June 30, 2016 against the credit limit of Tk 18 crore, which was also a violation of the banking norms.

In March 2014, the bank took over a loan amounting to Tk 5.40 crore taken by Golden Star Industries Ltd from the Mercantile Bank’s Dhanmondi branch.

The bank increased the credit limit to Tk 8.50 crore for Golden Star in November, 2015 although the client had huge amount of loans against trust receipt (LTR) under overdue position, the BB reports said.

The principal branch of the bank took over a liability of Tk 8.77 crore from an EXIM Bank client namely First Corporation (Pvt) Ltd on April 27, 2015.

The bank later raised the credit limit to Tk 20 crore for the client with taking collateral securities worth Tk 7.82 crore against a land submerged in water.

The client faced an overdue situation on August 27, 2015, but the bank did not show the loan as defaulted one, the BB reports said.

Moreover, the managing director of the bank extended the tenure of the credit limit for the company on July 15, 2016 without placing the proposal to the credit committee of the bank.

NRBC Bank’s principal branch disbursed Tk 20 crore to Mercantile Bank director Akram Hossain to rebuild a hotel on taking collateral securities of the client’s bank shares.

NRBC Bank has no information where the client used the fund meaning that the principal branch did not follow the due diligence to disburse the loan, the BB reports said.

The bank disbursed Tk 32.92 crore to Thermax Group without taking any collateral securities. Of the loan, Tk 30 crore was given to Standard Chartered Bank to repay the previous loans of the client.

No collateral securities were transferred to NRBC Bank from Standard Chartered Bank against the loan.

The client used the NRBC Bank to avoid being defaulted at Standard Chartered Bank, the BB reports said.

The principal branch also sanctioned a credit limit of Tk 226 crore to Anowar Ispat Ltd, Abdul Moem Ltd, Rangs Motors and Nitol Motors (Pvt) Ltd without taking any collateral securities.

The sanctioned credit limit has created a risky situation for the bank’s credit portfolio, the central bank’s reports said.

The Dhanmondi branch of NRBC Bank disbursed to Messer’s Goldberg Tk 24 crore of which funded loan was Tk 17.78 crore and non-funded loan Tk 6.22 crore.

The BB inspection teams unearthed that imported products worth only Tk 70 lakh to Tk 80 lakh remained at the client’s depot.

The client did not repay the loan to the bank after selling the imported products whereas NRBC Bank frequently opened fresh letters of credit against the client.

For this reason, the liabilities of the client continue to grow, the BB reports said.

The bank’s Dhanmondi branch disbursed Tk 10 crore to FAS Finance and Investment Ltd although the principal branch earlier sanctioned a credit limit of Tk 20 crore to the same institution.

The BB report said that the principal branch mainly disbursed the loans to the client using the name of Dhanmondi branch.

The principal branch tried to conceal its higher credit-deposit ratio by disbursing loan in the name of Dhanmondi branch.

The managing director of the bank approved to decrease the rate of interest on the client’s loan without placing the proposal before the bank’s credit committee violating the rules.

The board of NRBC Bank approved Tk 34 crore to one family of Aziz Chowdhury with his sons Salahuddin Chowdhury and Tareq Chowdhury under the home loan category.

The Gulshan branch of the bank placed the proposal before the board without mentioning any organisation’s name.

The loan money was later transferred to Stylish Garments owned by the family.

The branch in its credit proposal said that the client’s risk level was high, but the board approved the loan avoiding the concern of the branch, the reports said.

Against the backdrop, the central bank appointed an observer at the bank on December 29, 2016 to restore its credit discipline and corporate governance.

NRBC Bank managing director Dewan Mujibur Rahman told New Age on January 26 that he would not make any comment in this regard as the central bank was yet to send any observation to them.

He said, ‘I am trying to mitigate the existing crisis in my bank. It is not logical to make any comment as some issues involving my bank are now sub judice.’

Despite repeated attempts, NRBC Bank chairman Farasath Ali could not be reached for comment.

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