50pc loans of BDBL become classified
Chairman says, hands over Tk 100m dividend cheque to govt
FE Report | Friday, 15 September 2017
Almost half the total outstanding loans of Bangladesh Development Bank Ltd (BDBL) have become classified at the end of 2016, which the authorities consider a major setback for the bank.
Nearly 50 per cent or Tk 7.30 billion of the total loans of Tk 14.72 billion disbursed by the bank till the year-end turned classified, according to the bank officials.
They said the earnings from core banking were meagre, but made profit from other businesses, including investment, trading at share market and rental income from its buildings.
"Our classified loans are a big problem. Though classified loans are there, we are making profit from other businesses," BDBL chairman Md Yeasin Ali told a dividend handover ceremony at Bangladesh secretariat on Thursday.
The bank's authority handed over a cheque for Tk 100 million to finance division senior secretary Hedayetullah Al Mamoon against the profit it made in 2016. This is for the seventh time the bank handed over dividend checks to the government.
The bank chairman said most of the classified loans were from long term loans, which were a big burden for the bank. "But we are trying to bring it down."
Mr Mamoon asked the bank to find out reasons behind the high rate of classified loans in the bank. "Where is the weakness? Or, is there any problem in your system of granting loans? Or, are businessmen becoming defaulter willingly after investing a big sum?" said the secretary. "You have to monitor it closely."
BDBL managing director Manjur Ahmed said the bank earned a net profit worth Tk 382 million in 2016 and expressed the hope to make profit in the future. He said that no incidence of loan forgery took place in the bank since its inception, but recovery of loans given during 2012 and 2013 was facing complications.
He admitted that the bank could not attain expected success in recovery of classified loans. The classified loans, inherited since its establishment through merger of two financial institutions, remains as big problem, he noted.
Financial institutions division senior secretary Md Eunusur Rahman, BDBL directors Ekhlasur Rahman, Shahabuddin Ahmed and Salma Nasreen were present, among others, on the occasion.
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