RAKUB moves to raise capital base

The state-owned Rajshahi Krishi Unnayan Bank (RAKUB) has sought government intervention to raise its authorised and paid-up capital in order to meet its capital shortfall, officials said.
Managing Director of the bank Kazi Alamgir wrote to the finance ministry to take necessary steps in this regard.
Contacted, he said, "We now have a huge capital deficit. We have sought the government approval for raising the authorised capital. We also sought Tk 1.75 billion as paid-up capital."
"We would be able to meet the capital shortfall if the government gives green signal for raising the authorised and paid-up capital as per our requirement," he added.
A senior RAKUB official said the authorised and paid-up capital of the bank now stand at Tk 10 billion and Tk 8.24 billion respectively.
The bank seeks to raise the authorised and paid-up capital to Tk 15 billion and Tk 10 billion respectively.
According to a report of the bank, it had a capital deficit of over Tk 6.44 billion in the last fiscal year.
The volume of non-performing loans (NPLs) of the bank rose to over Tk 13.06 billion as of June 30, 2018 from over Tk 12.02 billion as of June 2017.
Asked, a finance ministry official told the FE: "We have received a letter from the RAKUB seeking to increase its capital base. We are now working on the issue."
The specialised bank has set a target to disburse Tk 22 billion in loans for the purpose of poverty alleviation and agriculture production in the current fiscal year (FY).
In the previous fiscal year (2017-18), the bank disbursed Tk 20.50 billion in farm loans, exceeding the target of Tk 19.50 billion.
The bank disburses 60 per cent of its total loan portfolio to the country's agriculture production sector.
As the largest development partner in agriculture of the northwest region, the RAKUB aims to aid overall development of farmers and all the sectors and sub-sectors of agriculture in this region.
The government provided over Tk 1.99 billion to RAKUB from the budget cake kept for banks, according to finance ministry data.
The specialised bank earned an operating profit (provisional) of Tk 100.95 million in the fiscal year 2017-18, according to the bank's documents.
The bank has 379 branches, including the LPO and Dhaka branch. Of them, 193 branches are in Rajshahi and 184 in Rangpur division.
The number of rural branches is 310. It has 69 urban branches. The RAKUB head office is located in Rajshahi.

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