Karmasangsthan Bank to open 57 more branches

As part of its expansion plan, Karmasangsthan Bank (KB) is set to open 57 new branches across the country, a high official of the bank said.
The BK board of directors in a recent meeting has taken the decision to open the new branches.
After getting the go-ahead from the board members, the bank has sought final approval from the government for opening the new branches.
At present, the bank has 212 offices across the country. Of the total, 64 offices are at district level while 6 in Dhaka city and the rest are in operation in different upazilas.
"Our board of directors has recently approved opening of 57 branches. Now we are waiting to get clearance from the government," Managing Director of Karmasangsthan Bank Md Obayed Ullah Al Masud told the FE.
"There is a huge demand for loans among the unemployed especially youth group of the country who cannot manage financial support from traditional banks. So, we have planned to expand our operation across the country," he added.
Mr Masud also said the bank has a plan to expand its operation to each upazila after implementation of the proposed one.
H. M. Fakhruddin Ahmed, Deputy General Manager, Loan Recovery, Law & Research Department of the bank, said as of March 2015, cumulative disbursement of loans by the bank has stood nearly at Tk 25.12 billion.
The bank has so far created 3.60 million direct employments for people especially those of youth group.
"More than 1.3 million people have also got employment indirectly with the financial help of the bank," MR Ahmed said.
"Our disbursement and recovery rate is very satisfactory which has prompted us to take a move for further expansion. The bank has so far recovered Tk 22.66 billion from the clients," he added.
According to Mr Ahmed, loan recovery rate of the bank is almost 92 per cent.
Meanwhile, a high official of the bank preferring anonymity expressed his concern over taking proper decision in selecting the sites for new branches.
"Our previous experience showed that many of our branches were established under political consideration which hampered the achievement of actual goal of the bank," he added.
"If there was no political pressure on selection of sites for new branches, the bank would do better than the present."
"Many branches are making very marginal profits and their contribution to creating employment is also lower than others," he added.
KB provides loan only to the unemployed people aged between 18 and 45 years.
The amount of loans disbursed by the BK ranges from Tk 0.05 million to 0.50 million depending on persons and groups and their evaluation.
The BK charges 13 per cent interest on their loans against its use in commercial sector and 11 per cent in production and services- oriented sector.  
Karmasangsthan Bank was established in 1998 as per Karmasangsthan Bank Act-1998 with a view to involving the unemployed people of the country especially the unemployed youths in the economic activities for poverty alleviation.
The government enforced this law on June 30 in 1998 being empowered to do so by Article 1(2) of this Act. The bank started functioning on 22 September 1998 with loan disbursement from its main branch in Dhaka.
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