Home Today's Paper Most Popular Video Gallery Photo Gallery
Subscription Blog Signin Register
Logo
Friday, June 23, 2017 05:53:30 AM
Follow Us On: Facebook Twitter Twitter Twitter Twitter

Privatization of SOBs not solution to mismanagement

By
21st-Mar-2017       Readers ( 251 )   0 Comments
Comments
Share your thought
Post a comment »
Read all (0) »

THE continuous losses of State-Owned Banks (SOBs) prompted the government to consider privatising them all, expect one, said media report on Monday. Most State-Owned Banks are now sustaining on tax-payer-funded money. Finance Minister AMA Muhith discussed the government's thinking in presence of the Managing Directors of all seven State Owners Banks, Governor of Bangladesh Bank, and the Secretaries of Finance and Banking Divisions. They discussed the capital shortfall of five State-Run commercial banks and two State-Run specialised banks while the Finance Minister held the view that funding those banks from budgetary resources is slowing their recovery. Banks must operate on cost-benefit basis.

Last year, six State-Owned Banks posted operating profits of Tk 2,010 crore, down 37 percent from a year ago. After provisioning and tax payments, these banks registered a net loss of Tk 511 crore for the year, which was Tk 125 crore in 2015. Two other State-Owned Specialised banks -- Krishi Bank and Rajshahi Krishi Unnayan Bank -- counted Tk 418 crore in losses last year, against Tk 167 crore in 2015.

Privatising the State Banks has been a long-standing options and experts support the option saying banks must stay in business through competition. Last year, Mohammed Farashuddin, former central bank governor, and Sadiq Ahmed, former World Bank official called on the government to immediately privatise those banks and take drastic measures against public enterprises to stop them from bleeding the economy.

But privatization has mixed results. Revenues received from sale of public equities were modest (roughly 35% of the target of Rs. 78,300 crores were realised in the period 1991-92 to 2002-03) from the sale of public companies in India. In the UK too there have been mixed results. While privatization has improved the service quality of some services like water distribution, it has also resulted in tremendous job losses for specific sectors.

Privatisation failed to demonstrate that private companies are always more competent than State-Owned ones. It also failed to demonstrate that citizens would own shares. Rather the truth is that these banks will pass to the hands of wealthy and politically powerful people to give concentration of the national wealth to few hands. There is no guarantee that these banks will improve performance, rather capital flight may further grow in one hand and income gap between the rich and the poor will cause more socio-economic tension in the country.

So many believe that the solution is not in selling these banks to the rich, but improving the bank management free from political control. So long political leaders will influence loan sanctioning and their rescheduling, the situation will not improve. We must say that the government should prove its competence to run banks instead of handing them over to powerful syndicates.  


0 Comments. Share your thoughts also.
Write a comment
Tariff
Add Rate

News Archive

Inside The New Nation

Editorial »

Mayors must do more to contain chikungunya in city


THE outbreak of mosquito borne diseases like a new type of fever called chikungunya, in addition to dengue fever in the city and elsewhere is causing additional concern to city dwellers and public health authorities how to protect people from this danger. People in most families in the city are ...

Back Page »

Zum'atul Wida


Abdul Muqit Chowdhury :The last Friday of the Holy Ramzan is called 'Zum'atul Wida'. It means 'departing Zum'a'. The musallies with due religious fervour join the Zum'a congregation and bid farewell to this month of patience and self-restraint. Al-Quran imposes obligation of the Friday prayer in the followingverses : "O ...

Cricket »

Malinga in hot water over 'monkey' comment


AFP, Colombo :Sri Lanka fast bowler Lasith Malinga faced an investigation Thursday after he compared a government minister to a monkey following criticism that the country's cricketers were too fat.Sports minister Dayasiri Jayasekera said he ordered an inquiry after Malinga lambasted him for questioning the endurance of Sri Lankan players ...

Entertainment »

Harry and Sejal grooving on Radha


Jab Harry met Sejal’s first song Radha is out and it’s as refreshing as it can get. The song features Shah Rukh Khan and Anushka Sharma dancing to the tunes of Sukhwinder Singh and Sunidhi Chauhan on the streets. The peppy number with its foot tapping music and catchy lyrics ...

Entertainment »

Samia Rahman’s Eid reality show Rupantor


Entertainment Report :A reality show will be telecasted in five days of Eid holidays and its result will be announced during this time. This short-term reality show Rupantor is planned by Samia Rahman. She will moderate the show. She will select 30 university females among hundred students. Produced by Samia ...

International »

Macron adds new faces to Cabinet after losing 4 ministers


AP, Paris :French President Emmanuel Macron brought several little-known figures into his government Wednesday as part of a reshuffle after corruption scandals started tarnishing his young Cabinet.Macron had planned to rearrange the government after his centrist party won a majority in parliamentary elections Sunday. He was forced to make more ...

Editorial »

Postponement of new VAT, but much more is needed


THE New VAT Act scheduled to become effective from July 1 is facing new crisis as the Finance Minister has been asked by the highest authority of the government to postpone it for the time being and find out why controversies with business communities and other stakeholders still remained unresolved. ...

Cricket »

Darren Sammy remains in Rajshahi Kings


Sports Reporter :The fifth edition of Bangladesh Premier League (BPL) Cricket will be held in this year. Defending runners-up Rajshahi Kings has started to form their team. West Indian star Darren Sammy led Rajshahi Kings in last year's BPL. Rajshahi Kings have retained Darren Sammy for this year's BPL. The ...

City »

Bangladesh Institute of Planners organised a discussion meeting on landslide at Jatiya Press Club yesterday.


Entertainment »

Afzal Sharif’s Eid TVC


Entertainment Report :Actors of the small screen always believe that they must have worked either play or telefilm in Eid. On the other hand, actors of big screen want their acted movie must be released in Eid. As a result, they pass the Eid festival joyfully. But actor Afzal Sharif ...

International »

State Department chastises Saudi Arabia, UAE over Qatar


 The Washington Post :The State Department issued an unusual public warning to Saudi Arabia and the United Arab Emirates on Tuesday over a diplomatic rift with fellow U.S. ally Qatar, and suggested that the Saudis may have provoked a crisis and drawn in the United States on false pretenses.Department spokeswoman ...

Editorial »

Encouraging violence is easy but containing not


AT the beginning we have to admit that we are glad the government leaders condemned the brutal attack on Mirza Fakhrul Islam Alamgir, the Secretary General of the majors opposition party BNP. In a highly rowdy situation Mirza Fakhrul Islam Alamgir's convoy came under attack allegedly by followers of ruling party ...

Football »

U-16 girls win Begum Sufia Kamal award


The Under -16 Girls who have kept the Bangladesh football's flag flying with their international success were finally rewarded when Bangladesh Mahila Parishad honored the Bangladesh women's U16 team with this year's Begum Sufia Kamal Award for their performance on the field.BFF's head of women's football, Mahfuza Akhter Kiron received ...

City »

Aparajeya Bangladesh formed a human chain in front of the Jatiya Press Club on Tuesday in protest against attack on BNP Secretary General Mirza Fakhrul Islam Alamgir in Rangunia.


Entertainment »

Tariq Anam, Suborna, Babu, Naziba`s Eid play


Sheikh Arif Bulbon :On the occasion of coming Eid, noted playwright and director Badrul Anam Soud has made a special play titled Durer Manush. Soud himself has written its story. Soud informed that story of the play revolves with a girl named Orpa.Naziba Bashar played the role of Orpa. Therefore, ...

 
Items that you save may be read at any time on your computer, iPad, iPhone or Android devices.
 
Are you new to our website? Do you have already an account at our website?
Create An Account Log in here
Email this news to a friend or like someone
Email:
Write a comment to this news