Operating profits of most of the scheduled banks in the country increased slightly in the just-concluded year due to lower rate of interest on deposit against higher rate on lending in the maximum period of 2014, said senior officials of scheduled banks. They said that the banks had also made write-offs and rescheduling to decrease their defaulted loans that played a positive role in increasing their operating profits.
A number of scheduled banks faced a burden of excess liquidity in the last year due to lower credit demand from the private sector amid political uncertainty which compelled the banks to decrease their rate of interest on deposits, BRAC Bank managing director Syed Mahbubur Rahman told New Age on Wednesday.
The banks, however, reduced their interest rate on lending later but they had enjoyed a large gap to decrease the rate between deposit and lending. Islami Bank Bangladesh posted the highest Tk 1,725-crore profit in the banking sector in 2014 while its profit was Tk 1,600 crore in 2013.
The profit of United Commercial Bank increased to Tk 885 crore in the last year from Tk 710 crore in 2013 while the Pubali Bank’s profit decreased to Tk 790 crore from Tk 815 crore.
The profit of The City Bank increased to Tk 520 crore in the last year from Tk 414 crore in 2013 while the EXIM Bank’s profit rose Tk 625 crore from Tk 520 crore.
The profit of Southeast Bank increased to Tk 832 crore in 2014 from Tk 680 crore in 2013 while that of Al-Arafah Islami Bank rose to Tk 645 crore from Tk 457 crore in 2013.
The state-owned BASIC faced an operating loss amounting to Tk 98.29 crore in the last year from a profit of Tk 178 crore in 2013 due to capital shortfall and defaulted loans.
Meghna Bank managing director Mohammed Nurul Amin told New Age that some banks had made huge amount of write-offs and rescheduling at the end of the last year to reduce their defaulted loans.
The lowered defaulted loans have played a significant role in making their operating profits jump, Amin, also a former president of the Association of Bankers, Bangladesh, said.
He said that the upward trend in import financing and inward remittance had also contributed to the increase
in the banks’ operating profits.
-With New Age input
