Monday, December 11, 2023

Banking sector reels as defaulted loan soars by Tk 8,294cr in Q1

The amount of defaulted loan in the banking sector increased by 19.41 per cent from Tk 42,725.51 crore as of December 31, 2012 to Tk 51,019.91 crore as of March 31, 2013, according to the latest Bangladesh Bank data released on Monday. The defaulted loan in the banking sector increased by Tk 8,294.40 crore in just first three months of the current year because of loan disbursement on political consideration and poor business environment which resulted in failure of borrowers to repay instalment in time, a BB official told New Age.
He said the defaulted loan had increased by Tk 20,081.35 crore in last year but such type of non-performing loan increased by Tk 8,294.40 crore in just one quarter.
He apprehended that the amount of defaulted loan might increase more in the rest of three quarters of this year.
‘The amount of defaulted loan shows the banks are in severe crisis. They will have to keep aside a huge amount of money as provisions against their newly-spotted defaulted loan, meaning they will face a liquidity crunch,’ he said.
The defaulted loan reached 11.90 per cent of the total outstanding loan in the banking sector as of March 31, 2013. The total outstanding loan was Tk 4,28,693.28 crore in the period.
Of the total defaulted loan, the amount of 30 private commercial banks increased by Tk 4,844.77 crore in the first three months. The total classified loan in the PCBs increased to Tk 17,879.62 crore as of March 31, 2013 from Tk 13,034.85 crore as of December 31, 2012. The total defaulted loan of the PCBs reached 6.23 per cent of their total outstanding loan of Tk 2,87,193.64 crore as of March 31, 2013.
A number of scams have been detected in some private commercial banks which pushed up the amount of defaulted loan in the banks during the period, the official said.
He said that the net profit of the PCBs might decrease significantly this year due to the increasing trend of the defaulted loan.
Classified loan of four state-owned commercial banks rose by Tk 2,888.22 crore in the first three months of this year. The total defaulted loan in the banks soared to Tk 24,403.12 crore as of March 31, 2013 from Tk 21,514.90 crore as of December 31, 2012. The total defaulted loan of the SCBs reached 27.06 per cent of their total outstanding loan of Tk 90,208.07 crore as of March 31, 2013.
Another BB official said the defaulted loan situation of the SCBs was worse than ever because of rampant disbursement of loan on political considerations without considering the impacts on their financial health.
The BB has recently detected unreported defaulted loan amounting to Tk 4,359.11 crore in four SCBs which caused the increase of overall classified loan in the SCBs, he said.
Classified loan of four specialised banks increased by Tk 348.36 crore in January to March of 2012. The total defaulted loan in the four banks soared to Tk 7,678.81 crore as of March 31, 2013 from Tk 7,330.45 crore as of December 31, 2012. The total defaulted loan of the specialised banks reached 27.17 per cent of their total outstanding loan of Tk 28,261.98 crore as of March 31, 2013
The nine foreign commercial banks had registered an increase of Tk 213.04 crore of defaulted loan in the first quarter of the current year. The total defaulted loan in the nine banks soared to Tk 1,058.36 crore as of March 31, 2013 from Tk 845.32 crore as of December 31, 2012. The total defaulted loan of the FCBs reached 4.60 per cent of their total outstanding loan of Tk 23,029.69 crore as of March 31, 2013.
The official said the new BB rule that requires banks to classify any loan if its repayment instalments are not deposited for three consequent months also caused the increase of defaulted loan in the banking sector.
The BB data showed that the defaulted loan increased by 101.74 per cent to Tk 51, 019.91 crore as of March 31, 2013 from Tk 25,289 crore as of March 31, 2012.
The ongoing political unrest is another cause of the increasing trend in banks’ defaulted loan, he said.
A number of entrepreneurs have counted loss in their business due to the ongoing violence caused by the political unrest which ultimately contributed to the upward trend in defaulted loan, he said.

-With New Age input

Related News

With ‘Face ID’ and ‘Fingerprint’ login bKash app is now more secure, user-friendly

Business Desk : bKash app introduces biometric ‘Face ID’ and ‘Fingerprint’ login features to make users’ daily transactions easier and safer. Alongside, exciting new features – ‘Group Send Money’, ‘Request Money’, ‘Savings Marketplace’ and selecting ‘Default Card’ to use the ‘Add money’ service from VISA card to bKash – are also included in the ... Read more

Grameenphone wins ‘Bangladesh Sustainability Excellence Awards 2023’ in Financial Inclusion

Business Desk : It was an evening to rejoice and remember for Grameenphone at the Bangladesh Sustainability Excellence Awards 2023, as the organization’s sincere efforts with flagship initiatives GP Accelerator and GP Academy received due recognition. Renowned media house The Daily Star, along with CSR Window, honored the winners at the Bangladesh Sustainability Excellence ... Read more

Banglalink wins the best sustainability award

Business Desk : Banglalink has won the ‘Best Sustainability Excellence Initiative’ award in the ‘Disaster Response’ category at the ‘Bangladesh Sustainability Excellence Awards 2023,’ jointly presented by The Daily Star and CSR Window Bangladesh. The award is in recognition of Banglalink’s contribution to societal welfare through the innovative integration of an Early Warning System ... Read more

StanChart wins Mastercard Excellence Awards

Business Desk : Standard Chartered Bangladesh has clinched awards in three categories at the “Mastercard Excellence Awards 2023”. The categories are “Excellence in Mastercard Contactless (Issuing)”, “Excellence in Mastercard Credit Business (International)”, and “Excellence in Mastercard Business (Innovation)”. Naser Ezaz Bijoy, chief executive officer of the multinational bank, received an award from Atiur Rahman, ... Read more

Nagad wins Mastercard Excellence Award 2023

Business Desk : Nagad, a popular mobile financial service provider in Bangladesh, has clinched “Mastercard Excellence Award” 2023 for its contribution to credit card bill payments. The mobile money carrier has been honoured with this prestigious award as the “Master Evolution”, reads a press release. On behalf of his company, Nagad’s Executive Director Maruful ... Read more

Prime Bank clinches Mastercard Excellence Awards 2023

Business Desk : Prime Bank PLC, a leading private commercial bank of the country, has won Mastercard Excellence Awards 2023 for Debit Business (Domestic) category. Nazeem A Choudhury, deputy managing director of the bank, and Masudul Haque Bhuiyan, head of Cards & Alternative Delivery Channel, received the award from Dr Atiur Rahman, former governor ... Read more

Zakia Rouf Chowdhury elected as vice chairman of Bank Asia

Business Desk : Zakia Rouf Chowdhury has been elected as Vice Chairman of Bank Asia Limited recently at the 508th meeting of the Board of Directors of the bank. She has an illustrious business career of more than 35 years in the private sector of Bangladesh. Since inception, she has been holding leadership positions ... Read more

Yamaha celebrates 7 years with ACI Motors

Business Desk : ACI Marts is the sole distributor and technical collaboration partner of Yamaha motorcycles in Bangladesh. ACI Motors started its journey in 2007 as a subsidiary of renowned company ACI Limited. In 2016, Yamaha started a new journey in Bangladesh with ACI Motors. At present, more than 116 Yamaha 3S (Sales, Service ... Read more

Walton boosts TV exports to Denmark, Ireland

Business Desk : Bangladeshi global electronics brand Walton has boosted up its exports of television to Denmark, Ireland and other European countries as the demand of Walton television goes high in those countries in recent times, according to a press release. Walton Global Business Unit’s Vice-President Syed Al Imran said that Walton has been ... Read more

Mutual Trust Bank launches privilege centres in Dhaka

Business Desk : Mutual Trust Bank Ltd recently launched its two revamped privilege centres in Dhanmondi and Uttara celebrating “MTB Retail Fest 2023”. Syed Mahbubur Rahman, managing director and CEO of the bank, inaugurated the centres as the chief guest, said a press release. Privilege Banking customers enjoy a wide range of exclusive benefits, ... Read more

Prime Bank Investment launches PrimeInvest

Business Desk : Prime Bank Investment Ltd (PBIL), a subsidiary of Prime Bank, launched PrimeInvest, a comprehensive discretionary product suite that aims to foster access to investment for individuals and institutional investors. CQK Mustaq Ahmed, chairman of PBIL, inaugurated the product at its head office in Banani in the capital, said a press release. ... Read more

Midland Bank strikes deal with Bangladesh Bank

Business Desk : Midland Bank Ltd recently signed a participation agreement with the Financial Sector Support and Strategic Planning Department (FSSSPD) of the Bangladesh Bank for availing refinance facility in US dollars. Liza Fahmida, director of the BB department, and Md Ahsan-uz Zaman, managing director of Midland Bank, inked the deal at the BB ... Read more

National Bank signs deal with Bangladesh Bank

Business Desk : National Bank Ltd has signed an agreement on “Financial Inclusion Credit Guarantee Scheme” with Bangladesh Bank, aiming to boost financing to cottage, micro, small and medium enterprises (CMSME). Manoj Kumar Howlader, director of the credit guarantee department of the central bank, and Md Mehmood Husain, managing director and CEO of National ... Read more

foodpanda and Toffee: Doubling Up on Benefits for Customers

Business Desk : foodpanda Bangladesh partnered with Toffee of Banglalink Digital Communications Ltd, a digital streaming entertainment app, to enhance the experience of Toffee subscribers by offering them exclusive foodpanda discount vouchers. An agreement has been signed between Toffee and foodpanda on this partnership on Thursday, reads a press release. Through this partnership, any ... Read more

US-Bangla gets recognition of IATA

Business Desk : US-Bangla Airlines, one of the largest airlines in Bangladesh, has become the first domestic private airline to be recognised as an International Air Transport Association (IATA) airline. By 2023, 18 airlines in the world have achieved accreditation as IATA Airlines, among which US-Bangla is one, reads a press release. Although several ... Read more

Emirates crowned as 2024 APEX World Class Airline

Business Desk : Having mastered the guest experience and providing exceptional customer service, Emirates was recently named a 2024 APEX World Class Airline winner at the 2024 APEX/IFSA Awards, held in Long Beach, California. Emirates is one of just eight airlines globally to achieve this accolade, reads a press release. Emirates also received a ... Read more

LAYS launches campaign with Shakib Al Hasan, Soumya Sarkar and Taskin Ahmed Tazim

Business Desk : Lay’s, one of the world’s most loved potato chip brands under the PepsiCo umbrella, has launched an engaging campaign featuring Bangladesh cricket stars Shakib Al Hasan, Taskin Ahmed and Soumya Sarkar as its brand ambassadors. Together, this dynamic trio will play essential roles in the upcoming Lay’s campaigns, endorsing the brand ... Read more

1,000 can win bKash World Cup Quiz everyday

Business Desk : A thousand winners can get Tk50 each everyday by participating in the bKash World Cup quiz. By answering 3 simple cricket related questions in the shortest possible time and making a transaction through bKash app one can win the prize. The quiz competition will continue till October 25, reads a press ... Read more

Syed Moazzam Hossain

Business Desk : Syed Moazzam Hossain has been elected as President of the Australia Bangladesh Chamber of Commerce and lndustry (ABCCI) for the term of 2023 -2025. Hossain is the chairman of Lama Rubber Industries Ltd and managing director of SMH Engineering Ltd, SMH New Generation Apparels Ltd and SMH AGRO Industries Ltd, said ... Read more

Reedisha Food holds sales conference

Business Desk : Reedisha Food & Beverage Ltd recently organised an “Annual Sales & Marketing Conference-2023” for members of the sales and marketing division of the company. Rezaul Karim, managing director of the company, inaugurated the conference as chief guest at the Hotel Sea Palace in Cox’s Bazar, said a press release. The company ... Read more