The state-run Rupali Bank Ltd is finding it hard to run normal business operations due to its continuing capital shortfall, officials said.
The latest available figures show the volume of capital shortfall of the trouble-torn bank rose to Tk 8.47 billion (provisional) as of June 2020 from Tk 5.37 billion last December.
As a result, the officials said, the bank is facing an acute problem in operating its usual activities, including the opening of letters of credit (LCs).
Rupali Bank managing director and CEO Md Obayed Ullah Al Masud has submitted three alternative proposals to financial institutions division to make its capital base sound and strong, they added.
The board of directors of the institution decided in its 1110th meeting to submit the proposals to finance division and financial institutions division to meet its capital deficit.
According to the proposals, the bank has suggested that the government issue long-term bond or provide cash support to meet its fund shortages.
It has also sought approval for issuing two rights against the existing one rights share.
Besides, the bank has sought to issue a guarantee paper that will be give the status of capital through the approval from the central bank, added the proposals.
The bank's paid-up capital is more than Tk 4.14 billion and its authorised capital stands at Tk 7.0 billion now, said a senior executive officer of the bank.
Rupali Bank is facing problems in operating its business for capital shortfall.
It has been paying higher charges to the foreign banks concerned for opening LCs, including subsequent functions, the officer has said.
"We've received the proposals sent by the state-run bank to meet its existing capital shortfall," a senior official of the banking division said.
The bank authorities are trying to preserve the authorised capital under the BASEL-III guideline of the Bangladesh Bank.
On June 28, 2018, a subordinate bond worth Tk 6.0 billion was issued for seven-year tenure.
An estimated Tk 1.20 billion will be provided every year in favour of the purchased banks from 2021.
Rupali's fund crunch will stand at Tk 14.47 billion if Tk 6.0 billion of the subordinate bond is deducted, according to the letter.
The bank is now listed on the two bourses.
Presently, 90.19-per cent shares of the bank are owned by the government and the remaining 9.81 per cent by institutions and general public.
On Monday, the bank's per share closed at Tk 28 against the face value of Tk 10, according to the Dhaka Stock Exchange.
The bank has deposited over Tk 31.68 billion in corporate tax, source tax, VAT, excise duty and stock dividend to the exchequer between 2010 and 2019.
The FE could not reach the bank's CEO on Monday evening as his mobile phone was switched off.
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