The finance ministry plans to enhance the authorised capital of four state-owned commercial banks to make space for the struggling banks to widen their capital bases in future given their soaring risk weighted assets and need for expanding operations. The move has been taken in less than one month after the government injected Tk 4,100 crore for the four ailing SCBs as recapitalisation fund.
The ministry took the move in line with the suggestions of the banks concerned.
In the first phase, authorised capital of Sonali and Janata would be increased to Tk 6,000 crore and Tk 3,000 crore respectively, sources at the finance ministry said.
Currently, the authorised capitals of the two banks are Tk 2,000 crore each.
The memorandum and articles of association of Sonali and Janata will be amended to increase the authorised capital for the two banks. Approval for the amendment has been sought from finance minister AMA Muhith on Wednesday, a high official at the Bank and Financial Institution Division under the finance ministry said.
After the approval comes from Muhith, the banks concerned have to apply to Registrar of Joint Stock Companies and Firms seeking amendment to their memorandum and articles of association.
The finance ministry early this month injected Tk 4,100 crore as recapitalisation fund to four SCBs in an effort to energies the ailing commercial banks that are plagued by loan scandals and soaring classified loans.
Of the Tk 4,100 crore, Agrani was given Tk 1,081 crore, Janata Tk 814 crore, Tk 1,995 crore to Sonali and Tk 210 crore to Rupali bank ltd.
The finance ministry officials said the cases for Rupali and Agrani would be considered after completion of Sonali and Janata as their authorised capital bases have become at par with their paid-up capital.
‘We need space for further increasing our paid-up capital,’ Pradip Kumar Datta, managing director, Sonali Bank Ltd told New Age on Thursday.
‘The planned enhancement in the authorised capital is now crucial as paid-up capital of Sonali has increased to the level of authorised capital.’
Senior bankers said under the Basel-2 requirements, the paid-up capital of a scheduled bank must be at least 10 per cent of its risk weighted assets, which made the SCBs to increase their capital bases in recent period as the bad loan outlooks of the banks have weakened.
They said increasing paid up and authorised capital of banks have numerous implications, some indicate positive development of banks, while some demonstrate the weakness of the banking companies.
-With New Age input
