Swindling leads to Tk 150b capital shortfall

Fakhrul Islam | Update:

Five state-owned banks are suffering from a capital shortfall of Tk 15,000 crore or Tk 150 billion, caused by corruption and mismanagement in their operations, records suggest.

These banks have sought Tk 4,000 crore in the form of bonds from the government, shows an official paper sent to the finance minister. The five banks were given Tk 8,000 crore cash support during 2014-16 period to make up for capital inadequacy.

In financial scams that took place between 2011 and 202013, three of these banks—Sonali, Janata and BASIC—had lost Tk 12,000 crore.

The central bank’s investigations also found corrupt practices by Rupali Bank, Agrani Bank and specialised banks of the government.

In this backdrop, the finance minister, AMA Muhith, sits with the top officials of these banks on Sunday to discuss the capital and take decision on whether to issue bonds in their favour.

Apart from financial scams, the failure to recover default loans and the managerial inefficiency has been assigned as reasons of making loss and poor financial health of these banks.

“Thousands of crores of taka have disappeared from these banks due to corruption, and managerial and operational inefficiencies. Still, money was injected into their funds. I think, the culture of these has degraded to the extent that the government will give them money, no matter what they do,” said Salehuddin Ahmed, a former governor of the Bangladesh Bank.

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