A file photo shows a man counting bundles of taka notes at a bank branch in the capital Dhaka. Banks’ corporate social responsibility spending dropped by 38 per cent or Tk 218 crore in July-December period of 2023 compared with that in the previous six months. — New Age photo
Banks’ corporate social responsibility spending dropped by 38 per cent or Tk 218 crore in July-December period of 2023 compared with that in the previous six months.
For the CSR purposes, 53 scheduled banks spent Tk 353 crore in July-December of 2023 against Tk 571 crore in January-June of 2023 and Tk 513.76 crore in July-December of 2022, according to Bangladesh Bank data.
The banks spent about Tk 924 crore in January-December of 2023 compared with that of Tk 1,129 crore in 2022.
Bank officials said that many banks were facing liquidity crisis and struggling with high distress assets that forced the banks to curtail their CSR spending.
Besides, the financial sector has been struggling with dollar crisis, inflationary pressure and confidence crisis in the wake of various scams, which could minimise their profit making capacity in 2023.
According to the central bank data, the amount of excess liquidity in banks dropped to Tk 1.5 lakh crore in February from Tk 1.6 lakh crore in January.
Private sector credit growth also dropped below 10 per cent in January amid the liquidity shortage and economic woes in the country.
Of the total CSR expenses in July-December of 2023, the highest amount, Tk 72.9 crore, was spent for education sector, followed by Tk 72.3 crore for health sector.
According to the BB report, CSR spending by banks declined massively in education, health and disaster management in July-December period compared with that in the previous six months.
Private commercial banks contributed the most, Tk 344 crore or 97.5 per cent, followed by foreign banks, Tk 6.46 crore or 1.83 per cent, and state-run banks, Tk 2.12 crore or 0.6 per cent, to the CSR spending in July-December.
Islami Bank Bangladesh Limited spent the most on CSR, Tk 53 crore, followed by Dutch-Bangla Bank and Southeast Bank.
However, non-bank financial institutions spent less on CSR, with only Tk 5.37 crore spent in July-December of 2023, due to an intense liquidity crisis in the sector.
The NBFIs spent only Tk 8.86 crore under CSR in the year 2023.
Fifteen NBFIs did not spend any money under CSR in 2023.
However, ensuring quality of CSR expenditure of the banks has remained a matter of concern, BB officials said.
As per the BB’s guidelines on CSR, banks are allowed to spend for charitable purposes from their net profits and such spending are not mandatory instead it is participatory.
Banks can spend 30 per cent of their allocated fund for education, 20 per cent for health and another 10 per cent for climate risk or disaster management.
Banks are allowed to spend the remaining 50 per cent for sectors like emergency disaster relief, promotion of environmentally sustainable output practices and lifestyles and enhancement of artistic, cultural, literary, sports and recreational facilities for underprivileged segments of people.
However, there is no limit on spending for such purposes.
New Age
