Home Today's Paper Most Popular Video Gallery Photo Gallery
Subscription Blog Signin Register
Logo
Wednesday, October 10, 2018 11:22:01 PM
Follow Us On: Facebook Twitter Twitter Twitter Twitter

Banking sector's health deteriorating fast

Loan irregularities spread as 'contagious' disease: Dr Salehuddin

By
11th-Oct-2018       
Comments
Share your thought
Post a comment »
Read all () »

Special Correspondent :
Health of the banking sector is deteriorating rapidly and it may have huge negative impact on the economy, said a former central bank governor on Wednesday.
"Large non-performing loans (NPLs) in both state-owned and private banks, corruption, loans scams, poor risk management practices and lack of good governance are some of the causes behind the ailing health of the sector," Dr Salehuddin Ahmed told The New Nation yesterday.
He said the problem is serious and the health of banks may deteriorate further if the financial sector governance does not improve immediately.
"The indicator most often cited as reflecting the health of the banking system is the ratio of NPLs to total advances. The ratio of gross NPLs to gross advances jumped to 20 per cent at the end of June this year from December last year. The high share of NPLs not only a matter of concern for the banking sectors but also for the economy," added Dr Salehuddin Ahmed.
The volume of NPLs rose to Tk 89,340 crore as of June 30, 2018 from Tk 74,303 crore as of December 31 last, according to Bangladesh Bank.
"Lack of transparency and accountability of the bank's board and management in sanctioning loans, large loan irregularities and weakness of the regulator were mainly responsible for rising non-performing loans. Among all the banks, state-owned banks particularly performed poorly with large NPLs and bad governance," observed Dr Salehuddin Ahmed.
The former central bank governor further said that widespread irregularities took place in disbursing 'big loans' by both the public over in the last few years. These loans have become non-performing ones and thereby helped deteriorate asset quality of the respective banks finally eroding health of the banking sector.
"Loan irregularities first occurred in the public banks. But, now it is spreading in private banks as 'contagious' disease, which is a 'ominous' sign for the banking industry." said Dr Salehuddin Ahmed.     
"Despite loan irregularities minor actions were taken against the loan scammers and defaulters as they have influence in political circle as well as in the society," he added.
When asked, he said, "The governance in banks has not improved due to lack of the government's political will. Even, two amendments in the Banking Company Act have also undermined good governance in the sector."

Tariff
Add Rate

News Archive

Inside The New Nation

Editorial »

Drug trade and abuse


A draft law has been approved in principle by the Cabinet which states that one could be sentenced to death for carrying, trading, storing or processing Yaba weighing over five grams.  The law placed at the Cabinet meeting chaired by Prime Minister Sheikh Hasina on Monday also said that death ...

Entertainment »

Namaste England Trailer 2 has the roller coaster ride of twists and turns!


After treating the audience with a much-appreciated trailer, the makers of Namaste England have now released another trailer for the film. Taking the cue from the first trailer, in the second trailer, there is a series of romance, drama and heartbreak. After watching the first trailer fans were gearing up ...

Sports »

Serena confirmed for eighth Australian Open title tilt


Seven times champion Serena Williams will be back at the Australian Open in 2019 having missed her title defence this year after giving birth, organisers said Tuesday.The 23-time Grand Slam winner, who won on her last appearance in 2017 while pregnant, will be joined in January's tournament by double Melbourne ...

International »

Brexit deal possible in weeks, says Northern Irish party


Reuters, Brussels : A Brexit deal is "eminently possible" within weeks but there can be no regulatory barriers within the United Kingdom, the head of the Northern Irish party that props up British Prime Minister Theresa May said on Tuesday.Less than six months before the UK's exit from the European Union, ...

City »

Chief Justice Syed Mahmud Hossain among the newly appointed Justice Zinat Ara, Justice Abu Bakar Siddiqui and Justice Mohammad Nuruzzaman to the Appellate Division after oath taking ceremony at the Supreme Court Judges’ Lounge on Tuesday.


City »

BNP Secretary General Mirza Fakhrul Islam Alamgir speaking at a discussion marking 28th martyrdom anniversary of Nazim Uddin Zehad in DRU auditorium on Tuesday.


Football »

Barcelona held at Valencia as Sevilla go top in Spain


Sevilla are the surprise leaders in La Liga after Lionel Messi could only rescue a draw for Barcelona away to Valencia on Sunday.Barca started the day at the top of the pile and then Atletico Madrid enjoyed a couple of hours at the summit after edging past Real Betis at ...

Editorial »

President of INTERPOL arrested in China: Proper explanation needed


THE Chinese authorities said on Monday that the President of INTERPOL Meng Hongwei who vanished while on a trip home last month has been arrested on suspicion of taking bribes. In a statement posted on a government website, officials said Mr Meng was being investigated by the National Supervision Commission, ...

City »

Gono Forum President Dr Kamal Hossain, among others, at a memorial meeting on Language Veteran Abdul Matin organised on the occasion of his 4th death anniversary by Gano Sangskriti Dal at the Jatiya Press Club on Monday.


International »

Interpol's former Chinese chief accused of bribery


AFP :The former Chinese head of Interpol, who went missing last month, was accused of accepting bribes on Monday, becoming the latest top official to fall in President Xi Jinping's anti-corruption dragnet.After days of concealing the fate of Meng Hongwei-who is also China's vice minister for public security-from the international ...

Entertainment »

Kangana speaks up on Vikas Bahl controversy


In 2015, there was a buzz in media, as an article was published where a woman who accused Queen director Vikas Bahl of sexual harassment. The incident recently came to light when the woman spoke up. Now Kangana Ranaut who worked with him closely on Queen has come out and ...

Entertainment »

Ferdous, Poppy pair up again in movie


Entertainment Report :Ferdous and Poppy got National Film Awards for several times. Ferdous got three times while Poppy received the awards for four times till now. Pair of Poppy and Ferdous again worked together in a movie Save Life. It will be directed by Aminul Islam.While talking about story of ...

Editorial »

The arrogance of Myanmar is not acceptable


VIOLATING international rules and border marks, military-backed pseudo-democratic Myanmar has now shown Saint Martin's Island of Bangladesh as their territory at a forged map. At least three Myanmar government websites use the map. Saint Martin's, the Southern small island is under Bangladesh government's sovereign authority for many years, and Myanmar ...

Cricket »

Shakib Al Hasan undergoing treatment in Melbourne


Bangladeshi world famed celebrated all-rounder Shakib Al Hasan now undergoing treatment in a 72-hour intensive care unit of a Melbourne clinic in Australia.Shakib admitted to a Melbourne clinic after reaching Australia on Saturday and will get his final report from his physician on completion of 72-hour on Monday, said a ...

City »

Prime Minister Sheikh Hasina distributed donations among the sports men, photographers, actors and Awami League leaders and workers at a function at her office yesterday.


 
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