The government is ready with a Tk 6.0 billion bailout for six cash-strapped financial institutions, including four state-owned banks, competent sources said.
They said the money is meant to help the financial outfits meet their capital shortfall, recapitalisation, fund assistance and provision deficit.
"Some Tk 18 billion had been allocated for replenishing capital of the state-owned banks and agencies in the revised budget of the last fiscal year (FY). The original allocation for bank recapitalisation for the last FY 2015-16 was Tk 50 billion." a senior official of the Ministry of Finance told the FE Friday.
A sum of Tk 12 billion was disbursed to the scam-hit BASIC Bank in the last fiscal, he added.
Some Tk 2.0 billion out of the remaining Tk 6.0 billion will be distributed to the Bangladesh House Building Finance Corporation (BHBFC) as fund assistance while Tk 1.40 billion for Bangladesh Krishi Bank meeting provision shortfall, Tk 1.78 billion for Sonali Bank (UK) Limited as paid-up capital, Tk 550 million for Rajshahi Krishi Unnayan Bank to meet capital deficit, Tk 250 million to Ansar-VDP Bank for recapitalisation and Tk 11.3 million for Grameen Bank for paid-up capital of government part, according to the finance ministry data.
State-run Janata, Agrani, Rupali and BASIC banks will not get any further money to cover their capital shortfalls from the last fiscal year's budget.
The allocation was started in the form of bank recapitalisation in the national budget after the much-talked-about Hall-Mark scam with the largest state-owned bank, Sonali Bank, said an official of the MoF who deals with the matter.
The finance division has proposed an allocation of Tk 20 billion for the current fiscal year (FY) 2016-17 under this head.
The Banks and Financial Institutions Division (BFID) under the MoF has sought an allocation of Tk 14.02 billion for replenishing capital, provision shortfall, fund assistance and paid-up capital of state-owned banks (SoBs) and government agencies, the data mentioned.
The government had pumped Tk 41 billion as recapitalisation funds, in the first phase, into Sonali, Janata, Agrani and Rupali banks in the fiscal year 2013-14.
The MoF has approached the finance minister for approval recently. The ministry sent the proposals to the official concerned for a review, he said.
"We will try to reduce further the allocation in the coming fiscal years as such funding has been hampering efficiency levels of the state-owned banks," said an official at the budget wing of the MoF.
During the July-December period of the fiscal year 2014-15, Sonali and Basic banks were given nearly Tk 13 billion to restructure their capital base.
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