Bangladesh Bank has asked troubled BASIC Bank to make an action plan for the recovery of default loans and the funds that went out through lending irregularities.
Central bank spokesman Mezbaul Haque said on Wednesday that Governor Abdur Rouf Talukder sat with the chairman, the managing director and other top executives on Tuesday to discuss the condition of the state-owned bank.
After taking charge in July, Rouf announced steps for special supervision of the banks in trouble. In August, he said 10 “weak” banks were identified.
The central bank has not named the banks, but appointed coordinators to National Bank, AB Bank, One Bank, Padma Bank and Bangladesh Commerce Bank following meetings between the executives of the banks and Rouf.
Now the central bank will determine measures for BASIC Bank once it submits the action plan.
A senior official at the central bank, requesting anonymity, said the process to appoint a coordinator to BASIC Bank was at the final stage.
BASIC Bank is trying to turn around now after it had almost sunk due to loan scams during the tenure of former Jatiya Party MP Sheikh Abdul Hye Bachchu as chairman.
The loans disbursed by the bank stood at Tk 135.77 billion as of September, including Tk 79.59 billion or 58.62 per cent default debt. The rate of default loans was 58.8 per cent in December 2021.
According to the bank’s financial statement, the loans disbursed by the bank were Tk 144.45 billion against a total deposit of around Tk 151 billion in 2021.
It recovered Tk 1.07 billion from the defaulters and Tk 91.2 million from written-off debt that year. The shortage of capital was Tk 7.14 billion.
During Bachchu’s tenure from 2009 to 2012, Tk 45 billion was embezzled from the bank through loan irregularities. The then directors of the bank are accused of clearing loans for fake organisations with forged documents.
After four years of investigation, the Anti-Corruption Commission started 56 cases against 156 people in 2015 over the BASIC Bank loan scams.
Before Bachchu took charge, the bank’s net profit was Tk 540 million in 2008. It has been counting losses since Bachchu’s term began. In 2021, its loss was nearly Tk 4.0 billion. Describing the time during Bachchu’s term as “uncomforting”, the bank said in the financial statement for 2021 it was actively trying to regain its image.
