Corrupt banks under finance ministry panel scanner
STAFF REPORTER
The Parliamentary Standing Committee of the Finance Ministry yesterday strongly condemned the irregularities of the NRB Commercial Bank and Farmers Bank and asked Bangladesh Bank (BB) to take necessary action within two months.
The parliamentary body also asked the four foreign financial units to provide the necessary information to the committee on the alleged laundering of Tk. 2,990 crore from the country by the Arab Bangladesh Bank on the pretext of offshore banking.
The committee will decide on the next course of action based on the reports given by the financial units.
In addition, the committee expressed concern over the alarming increase in the rate of distribution of loans by the Islami Bank Bangladesh ever since its new board of directors has taken charge. The committee has asked the bank authorities to provide information about the sectors in which loans are being disbursed and the clients at its next meeting.
Headed by the committee chairman Dr Muhammad Abdur Razzaque, the meeting was held at the Parliament building. The other members of the committee present at the meeting were MPs M A Mannan, Nazmul Hassan, Mustafizur Rahaman Chowdhury, Farhad Hossain, Md Sawkat Chowdhuri, and Akhtar Jahan.
Committee sources said the members lambasted the corruption in the banking sector.
The NRB Commercial Bank started functioning in 2013. But within a short time, the directors got embroiled in internal conflict and irregularities regarding the providing of loans, it was reportedly discussed at the meeting.
A special BB report has reportedly found that the bank took a resolution after forging the signatures of some directors who were absent at the meeting, disbursing loans in favour of organizations belonging to the chairman of the mercantile bank in violation of the rules.
The committee reportedly stated that the involvement of the board of directors and the managing director had been found in the issuing of a huge amount of loan without caring for the laws.
The BB report has also stated that the shares of six directors were confiscated and three of the directors were removed without following the rules.
The committee has also found that Farmers Bank got embroiled in several irregularities soon after it started operations in 2013.
The bank allegedly granted loans to organizations that existed only in signboards, to its own directors and the directors of other banks, and to defaulters, and often crossed the single-borrower exposure limit while granting loans, the committee said. Irregularities in recruitment have also been found.
Though BB has appointed an observer in Farmers Bank to check the increasing rate of irregularities and bring back discipline, the situation has not improved.
Muhammad Abdur Razzaque told journalists that the committee has recommended further investigation into the irregularities of NRB Commercial Bank and Farmers Bank to ensure the punishment of the responsible persons, bring back the trust of its customers, and to save the banks from destruction.
The Bangladesh Bank Intelligence Unit will investigate the irregularities in the two banks and take action according to rules within two months, he said.
These banks are public properties because people deposit their money here. If irregularities are found, the entire economy will be ultimately affected, he also said.
We dont want the banks to face the threat of being shut down. We want them to carry out their activities properly, following the rules and regulations, he added.
The amendment of the Bank Company Act, 1991, was also discussed at the meeting. A decision will be taken in the next meeting in the presence of finance minister AMA Muhith.
