Keeping over Tk 950 cr overdue Navana getting Tk 810 cr fresh loan

Staff Correspondent : Four state-owned banks Sonali, Janata, Agrani and Rupali are taking over huge distressed loans of Navana, one of the country’s leading industrial groups, which is on the brink of bankruptcy. The group has such loans to 20 non-banking financial institutions (NBFIs) of around Tk 950 crore.
By doing this, Navana Group will not have any liability to these financial institutions. Not only that, subject to the regularization of all Navana’s loans, the banks have also decided to give a new loan of Tk 810 crore. In other words, Navana’s debt of Tk 950 crore and new debt of Tk 810 crore is sitting on four state-owned banks.
Apart from this, the group currently has hundreds of crores of taka of debt from the banks.
A meeting was recently held between the concerned financial institutions, state-owned banks and Bangladesh Bank regarding the bailout of Navana Group. In this meeting, the final decision of loan takeover and new loan was taken through four state-owned banks.
Those concerned said that it is very difficult to turn around from the situation in which Navana Group companies are currently in. Despite this, the group is being given this special benefit by the interest of the top level of the government. But if the group fails to turn around even with these benefits, the banks’ investment will be at risk. It has been seen in the past that most of the loan acquisitions that have taken place in the banking sector have subsequently turned into defaults.
Former Director General of Bangladesh Institute of Bank Management (BIBM) Tawfiq Ahmed Chowdhury said, this is happening frequently in the banking sector. Such trends are not conducive to sound banking. It is the purchase or acquisition of such loans that is responsible for the huge amount of defaulted loans in state-owned banks. Big corporate houses from various banks are running with this facility. If they default on one bank, they take another big loan from another bank and repay the previous one. After a few days that loan becomes default again. How long will these last? He further said that it is getting worse when the government decides to give such benefits. As a result of this, in the future, other large corporate groups will also pressure the government to take such benefits.
In this way, we are making the government banks vulnerable. Later again we are blaming the banks.
It is reported that Navana Group applied to the government for financial assistance towards the end of 2019 to overcome the crisis if the financial situation deteriorates. The petition proposed to acquire all the loans of the industrial group taken from the private banks and financial institutions of the country by the state-owned banks.
After the application of the group, necessary directions were given to Bangladesh Bank from the Ministry of Finance to determine what to do in this regard. Earlier, the banks were also given separate directions from the finance ministry.
Sources say that until August last year, Agrani Bank acted as the lead bank in the loan acquisition process of financial institutions, but now Janata Bank is performing that responsibility. Bangladesh Bank has been playing the role of mediator in this process since the beginning.
Janata Bank MD Abdul Jabbar told our time, “I have just joined the bank. There has been no discussion with me about the matter yet. So, I can’t say anything about it.
Executive Director and Spokesperson of Bangladesh Bank. Majbaul Haque said, he does not have any information in this regard. As a result, he will not comment on the matter. MDs of other state-owned banks also refused to comment on the matter as the matter was pending.
It is known that on May 7, the final meeting was held with financial institutions regarding the loan bailout of Navana Group. Bangladesh Bank Deputy Governor Ahmed Jamal presided over it. According to the information presented in the meeting, 5 companies belonging to the Navana Group, Aftab Automobiles, Navana Limited, Navana Real Estate, Navana Construction and Navana Batteries have a debt of about Tk 965 crore to these 20 financial institutions.
Out of this, the debt of Aftab Automobiles is Tk 191.91 crore, Navana Limited is Tk 267.60 crore, Navana Real Estate is Tk 114.58 crore, Navana Construction is Tk 376 crore and Navana Batteries is Tk 15.43 crore. On the other hand, the liability of these 20 financial institutions to the 4 state-owned commercial banks (in the credit and fund placement sector) is about Tk 2,550 crores. Of this, Sonali Bank has Tk 512 crore, Janata Bank Tk 607 crore, Agrani Bank Tk 687 crore and Rupali Bank Tk 746 crore.
Before this, another meeting of Bangladesh Bank with four state-owned banks was held on March 30 regarding the financial crisis transition (bailout) of Navana Group. It was presided over by Deputy Governor Abu Farah. In that meeting, the decision of the banks to acquire the loans of the Navana Group financial institutions and give new loans to the group was finalized.
Whereas, BB governor Abdur Rouf Talukder recently in a meeting with the CEOs of different banks have decided to make liable to the CEO for the default loans of his concern bank. This is a double standard policy, told many CEOs of different banks.