Rejaul Karim Byron
The comparatively high loan growth of Rupali Bank among state banks this year has raised suspicions of the International Monetary Fund.
Rupali’s net loan growth between December 31, 2012 and August 31, 2013 stood at 9.99 percent against Sonali’s -4.41 percent, Janata’s 0.81 percent and Agrani’s 1.76 percent, according to central bank statistics.
The IMF mission, which left Dhaka on October 6, raised questions as to why Rupali’s loans shot up when Janata’s and Agrani’s increased slightly and Sonali’s even declined, a central bank official said, asking not to be named.
“Given the political uncertainty, most banks are struggling to disburse loans. Rupali’s exceptionally high loan growth in such a scenario made the IMF suspicious of wrongdoings in the bank,” the official said.
Rupali’s loan growth target for the whole year was 10 percent but by August the bank’s total loan growth overshot the target by 1.24 percent, while its net loan growth almost reached that figure.
“They [the IMF mission] urged the central bank to monitor whether any financial irregularities were taking place at Rupali,” the official added.
But a high official of Rupali told The Daily Star that its loan base was “low” in December compared to other state banks and hence the higher growth.
Rupali’s total loans and advances on December 31, 2012 stood at Tk 9,064.15 crore, while Sonali’s Tk 37,786.7 crore, Janata’s Tk 30,340.2 crore and Agrani’s Tk 21,266.3 crore.
Meanwhile, one of the reasons for the sparse loan growth in the other three banks is that the government has repaid some of its loans from them in the face of IMF pressure.
The three banks’ loans to the government on August 31 stood at Tk 4,730 crore, down from Tk 12,176 crore on December 31.
The government paid Tk 2,500 crore to Sonali, Tk 1,800 crore to Janata and Tk 1,600 crore to Agrani for their loans to Bangladesh Petroleum Corporation, the central bank official said.
Pradip Kumar Dutta, managing director of Sonali Bank, told The Daily Star that the banks have pulled back from their aggressive lending stance and are now exercising caution over their lending activities, and hence the low loan growth.
“Moreover, many borrowers are taking fewer loans now due to political uncertainty. On one hand, loan recovery is good and on the other hand, demand for new loans is less,” he said, adding that Sonali has recovered Tk 2,870 crore loans in the first nine months of the year.
A high official of Janata Bank, too, said their loan recovery is good. “We have almost recovered the whole year’s target against classified loans. And on the other hand, the demand for fresh loan was less and so the credit growth fell.”
The central bank official further said necessary actions would be taken against the banks which failed to bring down their loan growth in the quarter that ended on September 30.
Source: The Daily Star
