Azizul asks NCBs to ward off political pressure after corporatisation
Sunday, 22 July 2007
Finance Adviser AB Mirza Azizul Islam Saturday asked the country's three nationalised commercial banks (NCBs) not to give in to political pressure once they were corporatised, reports bdnews24.com.
He said, past political governments, with access to public money, had made motivated decisions on the utilisation of money in the NCBs.
"We have seen this happened in Bangladesh so many times since the Independence," said Azizul at a seminar titled 'Janata Bank: changing corporate culture in Bangladesh', held at the Brac Inn Centre.
"Professional incompetence in these banks was aggravated by political interference in management and day-to-day tasks," he also said.
The adviser said, the makeshift government has decided to corporatise Sonali, Janata and Agrani banks so that their management boards can function independently and autonomously.
After corporatisation these banks will be controlled by Bangladesh Bank instead of the Finance Ministry, separating the management of the banks from their owners.
The banks have already been given licences to operate as public limited companies or corporate bodies. Corporatisation is a pre-requisite for the privatisation process, according to financial analysts.
The government will continue to own total shares of the banks after their corporatisation, while a board of directors, comprising seven to twelve experienced members, will be formed. However, the ownership issue requires further assessment, the adviser told the seminar.
Referring to his experience as the chairman of Sonali Bank, he said, although these banks were run under the Finance Ministry, he saw other ministries intervened in it more than the Finance Ministry did.
"A section of politicians perceived these NCBs as sources of exploitation," Azizul said. He said, concentrated and excessive borrowing from the NCBs has adversely affected the economy, leading to vast amounts of bad debts, financial losses, trade unionism and inefficiency.
He also criticised the NCBs for providing poor services and products to its clients. He asked them to switch over to new products from the traditional loans and deposits schemes.
The World Bank, the International Monetary Fund and other development partners have long been asking the government to corporatise the NCBs to improve their services.
"I hope corporatisation of the NCBs will improve their services," added the adviser.
Siddiqur Rahman Choudhury and Suhel Ahmed Choudhury, chairmen of the board of directors of Agrani and Janata banks, also spoke at the seminar.
He said, past political governments, with access to public money, had made motivated decisions on the utilisation of money in the NCBs.
"We have seen this happened in Bangladesh so many times since the Independence," said Azizul at a seminar titled 'Janata Bank: changing corporate culture in Bangladesh', held at the Brac Inn Centre.
"Professional incompetence in these banks was aggravated by political interference in management and day-to-day tasks," he also said.
The adviser said, the makeshift government has decided to corporatise Sonali, Janata and Agrani banks so that their management boards can function independently and autonomously.
After corporatisation these banks will be controlled by Bangladesh Bank instead of the Finance Ministry, separating the management of the banks from their owners.
The banks have already been given licences to operate as public limited companies or corporate bodies. Corporatisation is a pre-requisite for the privatisation process, according to financial analysts.
The government will continue to own total shares of the banks after their corporatisation, while a board of directors, comprising seven to twelve experienced members, will be formed. However, the ownership issue requires further assessment, the adviser told the seminar.
Referring to his experience as the chairman of Sonali Bank, he said, although these banks were run under the Finance Ministry, he saw other ministries intervened in it more than the Finance Ministry did.
"A section of politicians perceived these NCBs as sources of exploitation," Azizul said. He said, concentrated and excessive borrowing from the NCBs has adversely affected the economy, leading to vast amounts of bad debts, financial losses, trade unionism and inefficiency.
He also criticised the NCBs for providing poor services and products to its clients. He asked them to switch over to new products from the traditional loans and deposits schemes.
The World Bank, the International Monetary Fund and other development partners have long been asking the government to corporatise the NCBs to improve their services.
"I hope corporatisation of the NCBs will improve their services," added the adviser.
Siddiqur Rahman Choudhury and Suhel Ahmed Choudhury, chairmen of the board of directors of Agrani and Janata banks, also spoke at the seminar.