845 SB money suits settled last year, 3,749 pending

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Syful Islam
The Hallmark loan scam provided the much-needed wake-up call for the Sonali Bank Limited, as the state-owned bank started sending law division officials to different branches to monitor the state of pending money suits and the problems with their quick disposal, a top official said.
The bank had an aggregate amount of Tk 43.97 billion lying unrealised against 3,749 cases filed with different Artha Rin Adalats or money loan courts until August this year.
Besides, some 105 writ petitions, involving Tk 9.42 billion, also remained pending with higher courts.
The largest state-owned commercial bank (SCB) could settle about 845 money suits in 2011, officials said.
A top official of the bank told the FE that as the largest ever loan scam involving about Tk 35.74 billion surfaced, "We have started to monitor activities, especially at the branches."
"Our law division officials now regularly sit with regional heads, branch managers and panel lawyers to sensitise them about special checking of applicants' documents before granting loans.
Besides, they are asked to take necessary steps for quick disposal of the pending cases," he said seeking anonymity.
He said: "The bank is facing an acute liquidity crisis. So, realising money within or outside the court is now our top priority."
Statistics show that the bank's daily cash reserve ratio (CRR) shortage has reached Tk 7.46 billion. It borrows Tk 30.28 billion a day to carry out its day-to-day affairs.
The bank's classified loans stood at Tk 70.16 billion in June last, 21.59 per cent of its total outstanding loans against the average of 7.17 per cent classified loans in the banking sector.
Sonali Bank's spokesman Deputy General Manager Dr Hafizur Rahman told the FE that in many cases borrowers or their relatives repay money just after publishing auction notice or taking possession of mortgaged property.
He thinks many cases can be settled through bilateral negotiations instead of just waiting for a solution from the court.
Mr Rahman said: "If necessary, we offer interest waiver to the borrowers to recover the stuck money."
A general manager of the bank, preferring anonymity, said money suits involving Tk 1 million to Tk 3 million are being settled easily through negotiations.
He thinks a major portion of Sonali Bank's 845 money suits settled last year were petty cases in terms of the amounts of money involved.
"Cases involving higher volumes of money are hardly settled easily since the borrowers file writ petitions to delay the payment," he said, adding many cases remain unsettled for several years as disposal of petitions takes time.
The senior banker said if the government wants quick disposal of the money suits for immediate recovery of the stuck money, steps have to be taken for quick settlement of writ petitions.
"In that case additional benches have to be established to settle the writ petitions involving Artha Rin Adalat," he added.
Identifying loopholes in the Artha Rin Adalat Ain, another senior banker said the court sometimes appoints an arbitrator for settlement of cases outside the court.
"This is absolutely a waste of time. None of the parties accepts the arbitrator's decision. The borrowers insist on the court's appointing arbitrators so that they can make delay in repaying the money," he said adding, "During the last couple of years I did not see disposal of any cases through this process."
He said there should be a specific guideline for alternative resolution of the cases which is now absent.