The Bangladesh Bank on Wednesday appointed an observer to the National Bank Limited following several alleged anomalies including increasing rate of defaulted loans and ‘unwanted’ interference of the board of directors in the bank’s activities. BB executive director Mahfuzur Rahman told New Age that the central bank’s forex reserve and treasury management department general manager Kazi Saidur Rahman was appointed as the observer to the National Bank.
‘Some financial indicators of the NBL are not satisfactory. This is why the central bank has appointed an observer,’ Mahfuz said.
He said that usually the central bank appoints an observer to a private bank when it feels that the board of directors of the bank is not doing its job properly.
‘So, now the observer will attend the board meetings of the NBL and will also monitor the loan approval process of the Bank,’ he said.
The BB directed the NBL authorities to send the agenda of the board meeting to Saidur Rahman at least three working days before the meeting.
BB officials said that the senior management of the central bank in an emergency meeting on Saturday decided to appoint the observer.
They said that the central bank has found some serious irregularities in loan approval process in some branches of NBL including the Gulshan branch in Dhaka and Agrabad branch in Chittagong.
They said that there was allegation that the immediate past managing director of NBL, Shafiqur Rahman, was
forced to resign five months ahead of completion of his schedule tenure of office.
Shafiq in his resignation letter last month cited personal reasons for his resignation, but the central bank received allegations that some of the influential board members forced him to leave.
BB officials said that the NBL was also violating the Bank Company Act as five members of a family were directors of the bank. The act forbids presence of more than two persons of a family as board directors.
The central bank deadline to reduce the number of family member in the bank’s board ended in July 22, said the officials.
Asked about the issue, BB deputy governor Razi Hasan told New Age that the central bank would take steps against the banks which have more than two family members in the board.
‘We are now preparing a list of the banks that violated the law of maximum family member in a bank’s board of directors including the NBL,’ he said.
-With New Age input
