Depositors of 9 banks unsafe

Vulnerable condition

Zarif Mahmud: The country’s banking sector has become overwhelmed with defaulted loans. At the end of last June, defaulted loans stood at Tk 2 lakh 11 thousand 392 crores. Some banks are not able to keep the required provision of customer security against these defaulted loans. Among them, the accumulated deficit of 9 banks stands at Tk 31,520 crores. However, as most of the banks keep surplus reserves, the total deficit stands at Tk 24,800 crore. Among the 44 private banks, National Bank is at the top with a deficit of Tk 1,471 crore. The depositors of the banks which are short of reserves are at risk, said the concerned.
The updated information of Bangladesh Bank says that at the end of June, the total savings deficit of 9 banks in the country is Tk 31,520 crores. However, due to the surplus of some banks, the overall deficit in the banking sector has reduced to Tk 24,810 crores. However, the amount of this deficit was Tk 19,261 crore last December. Accordingly, the provision deficit has increased by Tk 5,548 crores in the span of 6 months.
In this regard, the former chief economist of the World Bank Dhaka office Zahid Hossain said, against the net profit, dividends are usually given to bank shareholders. But if provision is saved from that profit, then the amount of dividend comes down. For that reason some banks don’t want to keep provision for more profit. But not keeping provisions increases the risk of depositors. Provision has been made mandatory for banks to avoid this risk.
According to the data of Bangladesh Bank, Agrani Bank, which is on the top of the deficit list of government banks, has a deficit of Tk 5,312 crores. State-owned Basic Bank is in second place. The deficit of the bank stands at Tk 5,241 crores. Rupali Bank’s provision deficit is Tk 4,401 crores. Meanwhile, in the private sector, National Bank has a provision deficit of Tk 1,471 crore, Bangladesh Commerce Bank Tk 443 crore, Dhaka Bank Tk 327 crore, IFIC Bank Tk 505 crore, Standard Bank Tk 391 crore and another bank has a provision deficit of Tk 198 crore.
As per banking regulations, banks are required to keep a provision of 0.5 percent to 5 percent of operating profit. 20 percent against low quality defaulters, 50 percent against doubtful defaulters and 100 percent against bad loans.
Bangladesh Bank spokesperson Md. Majbaul Haque said that many banks are struggling to collect loans in an aggressive manner. Liquidity crisis has occurred in various banks due to less collection of loans. Again, some banks have failed to keep security against defaulted loans. The central bank is pushing all those banks to get out of this situation. However, if any bank fails to protect the deposit even after getting repeated opportunities, Bangladesh Bank will take action.