Staff Correspondent: Banks in the country are always more interested in lending to larger groups. That is why there is sick competition. Huge amounts of loans are being given on nominal collateral without considering the capacity and risk of these institutions or groups. One of these is the leading state-owned bank-Agrani Bank Limited. About 46 percent of the bank’s total loans are to 13 groups or companies. This information has emerged from Agrani Bank’s annual report.
According to the report, the bank’s debt status at the end of 2022 was Tk 72,938 crore. Out of this, the debt status to the top 13 groups and companies was Tk 33,788 crore, which is 46.32 percent of the total debt. And at the end of last December, Agrani Bank’s loan amount to only 44 companies was Tk 53,435 crore, which is 72.26 percent of the total loan.
Among the top 13 companies, RPCL-Norinco International Power Limited has the highest debt. The loan amount given for the construction of Patuakhali 1,320 MW power plant under the company stands at Tk 10,373 crore. Besides, Tk 3,852 crores to Unique Group, Tk 3,000 crores to Bangladesh Chemical Industries Corporation (BCIC), Tk 2,978 crores to Bashundhara Group (Sayem Sobhan), Tk 2,656 crores to Bangladesh-China Power Company (Payra Power Plant), Tk 2,000 crores to Orion Group. Tk 254 crores, Tk 1,821 crores to Bashundhara Group (Safwan Sobhan), Tk 1,334 crores to Bangladesh Power Development Board (PDB), Tk 1,202 crores to BSRM Group, Tk 1,157 crores to Zakia Group, Tk 1,110 crores to Thermex Group, Abul Khair Tk 1,050 crore in the group and Tk 1,001 crore in Judge Bhuiyan group.
What percentage of the total loan disbursed a bank can give to large customers is also regulated by the Bank Companies Act and the Central Bank’s policy. In this case, it is also seen that Agrani Bank did not give loans in accordance with that policy. According to a report of Bangladesh Bank, the bank can give up to 30 percent of the total loan portfolio in case of large customers. But the bank’s large loan ratio stood at 36 percent at the end of December. Apart from this, 19 customers have given loans of more than 25 percent of the bank’s total capital, which is a violation of Bangladesh Bank norms.
If you want to know about this, Agrani Bank chairman and economist Dr. Zaid Bakht told, “Bangladesh Bank has changed the credit limit policy of a single customer. Earlier it was calculated on authorized capital. Now it is paid up capital. This resulted in a debt situation of more than 25 percent of capital. It will take some time to fix. Trying to reduce those who go beyond the single customer credit limit. Now I am being careful in giving new loans.
The bank’s lending is not only focused on large customers. Most of the loans are concentrated in five branches. According to the report, 41 percent of Agrani Bank’s total loans are concentrated in five branches. At the end of 2022, the bank’s debt standing was Tk 72,938 crores. Out of this, the debt status in five branches stands at Tk 29,982 crores, which is 41.10 percent of the total debt. Most of these loans are from the principal branch under the main office of the bank. Its amount is Tk 20,647 crores, which is 28.31 percent of the total debt. In addition, two thousand Tk 765 crore or 3.30 percent from Foreign Exchange Corporation branch, Tk 2,408 crore or 3.30 percent from B-Wapda branch, Tk 2,112 crore or two.90 percent from Amin Court Corporate branch and WASA Loans of Tk 2,49 crore were disbursed from the corporate branch.
Loan disbursement increased
At the end of 2021, Agrani Bank’s deposits were Tk 1,864 crore, at that time the loan was Tk 59,790.29 crore. At the end of 2022, the deposits decreased to Tk 93,077 crores. And the debt increased to Tk 72,938 crores. That is, the deposit of the bank decreased by Tk 7,787 crores in one year. And during this period the debt increased by Tk 13,148 crores. That is, despite the decrease in deposits, last year the bank joined several syndicated loans, and also gave new loans to large customers.
Defaulted loans increased 150 pc
At the end of 2021, the defaulted loan of the bank was Tk 9,987 crore, at the end of last year 2022, which increased to Tk 15,400 crore. In one year, the defaulted loans of the bank increased by Tk 5,413 crores. As a result, the bank has faced a huge capital crisis. Last 2021 capital deficit was Tk 1,548 crore. At the end of 2022, it has increased to Tk 2,733 crore.
Banks are generally more interested in lending to larger customers, say industry insiders. And the phenomenon of concentration of loans to large customers is old, due to which the banking sector is becoming hostage to the bright customers. This is not a good sign for the banking sector. This increases defaults when a customer becomes insolvent, which creates additional risk for the bank.
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