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Digital banking is the ‘quintessence of Dhaka Bank’, says its chairman

Siddique Islam | July 05, 2022 00:00:00

Abdul Hai Sarker

Dhaka Bank Limited wants to attract new customers through providing world-class services using the latest technologies, the bank's top policy maker has said.

"We're committed to provide time-bound services to our valued customers," Abdul Hai Sarker, chairman of Dhaka Bank, told the Financial Express (FE) recently ahead of the bank's 27th anniversary.

The second generation private commercial bank (PCB) started its journey on July 05, 1995 with a slogan 'Excellence in Banking.'

The chairman also said: "Our board devoted its time and energy to provide suitable guidance and direction to the management to ensure uninterrupted service to our customers while being fully compliant with regulatory advices."

The PCB is also working continuously to develop digital banking instead of the existing 'brick and mortar' one for providing world-class services to its customers, the chairman explained.

As part of the moves, Dhaka Bank has already introduced mobile banking apps 'DBL Go,' Internet Banking, Bills to Cash, Trade Cloud, Ezy Bank and many other tech based services for its customers.

"We've always been focusing on technology based banking using FinTech (financial technology) aiming to provide better services to the customers," Mr Sarker noted.

He also said since inception Dhaka Bank is one of the tech-based banks and till now we have been among the top most digital banks of Bangladesh.

Mr Sarker, also founder chairman of the PCB, spoke on different issues like rising trend of classified loans, 9.0 per cent cap on lending, foreign exchange market and corporate governance in the country's banking system.

The amount of classified loans is increasing day by day that is also hampering the growth of the country's banking sector as well as the national economy, according to the founder chairman.

The amount of classified loans in Bangladesh's banking system increased by 9.85 per cent to Tk 1,134.41 billion during the January-March period of 2022, from Tk 1,032.74 billion in the preceding quarter (Q4 of 2021), according to the central bank's latest statistics.

Loan defaulters are using legal loopholes in the country," the senior entrepreneur said, adding that default culture will not be stronger if the strong legal framework against the loan defaulters is available in Bangladesh.

Mr Sarker, also a former president of the Bangladesh Textile Mills Association (BTMA), has urged the policy makers for taking effective measures for boycotting the loan defaulters socially, economically and politically.

Regarding the Bangladesh Bank (BB)'s latest relaxed loan-repayment policy, the chairman said borrowers, who became loan defaulters before the Covid-19 pandemic, are getting more benefit that is the problem.

Earlier on June 22, the central bank revived its relaxed loan-repayment policy to keep the ongoing economic activities stable despite long-term negative impact of the Covid-19 pandemic as well as the Russia-Ukraine war.

Under the relaxed stances, the borrowers of large industries are allowed to repay their term loans, which became unclassified on 01 April, in phases - 50 per cent by April-June of this calendar year, 60 per cent in July-September, and 75 per cent in the final quarter of 2022 - without becoming defaulters.

For cottage, micro, small and medium enterprises (CMSMEs), the borrowers must repay 25 per cent of their payable loans in the second quarter, 30 per cent in the third quarter, and 40 per cent in the last quarter of this year - to avoid falling into the defaulter category.

"Willful loan defaulters may get more benefit from the relaxed policy than genuine borrowers," Mr Saker said while replying to a query.

The senior business leader has also sought strong judiciary support to speed up the recovery process of classified loans, saying that it would also help improve financial health and growth of the banks.

He also said the functions of Artha Rin Adalats (Money Loan Courts) should be strengthened across the country for settling the cases within the shortest possible time-frame.

Actually, there is a twin-effect of non-performing loans (NPLs) in the banking system.

The banks will have to keep the interest earned from default loans to their interest-suspense account, instead of taking it into profit account.

Besides, the banks will have to ensure required provisioning against total classified loans from their profits. At the same time the banks also have to pay interest on the deposits.

"We're focusing our financing in retail and small and medium enterprises (SME) for minimising risk as well as diversifying portfolios gradually," the chairman said while explaining about the bank's future business plan.

Dhaka Bank is increasing its investment in retail and SME sectors continuously aiming to bring more un-banked people in the banking network through boosting the ongoing financial inclusion initiatives across the country, he added.

"We're also emphasizing on the cottage, micro, small and medium enterprises (CMSMEs) sector to help achieve sustainable development of Bangladesh," the chairman added.

"With the strength of our bond with all stakeholders, we have a significant role to play in the country's economic rise and our dream of becoming the best banking brand in Bangladesh," Mr Sarker, who obtained a post-graduate degree from the University of Dhaka in 1970, noted.

Mr Sarker, also the chairman and chief executive officer of Purbani Group, one of the largest and oldest textile conglomerates in Bangladesh, was born in a respectable Muslim family of Sirajgonj district in 1946.

Currently, Dhaka Bank serves a large customer base comprising individuals and business entities through a network of 109 branches across the country.

Besides, the PCB is also providing services to the clients through more than 53 ATM (automated teller machine) booths along with 23 sub-branches to provide better services to its clients.

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