Five state-run banks are seeking cooperation of the finance ministry in recovering a big chunk of unrealised loans worth over Tk 290 billion from 13 public entities.
The half-yearly statement of Bangladesh Bank (BB) shows that Sonali, Janata, Agrani, Rupali and BASIC Bank have so far failed to realise the volume of loans despite their efforts.Of the loan amount, Tk 163.32 billion was funded or cash loan while Tk 130.50 billion non-funded loan against LC guarantee, according to the BB report.
This scenario came up in the central bank’s half-yearly July 2020 statement about the unrealised loans of the state-owned commercial banks to the public enterprises.
On behalf of the banks, Bangladesh Bank has recently sent a letter to the ministry of finance, seeking its cooperation in recovering the loans. The central bank also attached a brief history of these loans along with the letter.
The banks have complained that despite various efforts, they have not been able to realise the loans from the public entities.
Asking not to be named, a managing director (MD) of a state-owned bank told the daily sun, “We face pressure to improve our performance, especially in loan recovery, but a state-owned bank cannot do it overnight.”
The report shows that Sonali Bank provided loans of Tk 120.61 billion, Janata Bank Tk 23.41 billion, Agrani Bank Tk 5.41 billion, Rupali Bank Tk 13.32 billion and Basic Bank Tk 0.41 billion.Of the unrealised loans, Sonali Bank has a total classified loan of Tk 253 million, Janata Bank Tk 71.3 million, Agrani Bank Tk 40.8 million, Rupali Bank Tk 266.5 million and BASIC Bank Tk 20 million.
The central bank half-yearly reports suggest that Sonali, Janata, Agrani, Rupali and BASIC Bank provided an aggregate loan of Tk97.87 billion to six companies in the industrial sector.
The six enterprises are Bangladesh Textile Mills Corporation (BTMC), Bangladesh Jute Mills Corporation (BJMC), Bangladesh Securities and Exchange Commission (BSEC), Bangladesh Sugar and Food Industries Corporation (BSFIC), Bangladesh Chemical Industries Corporation (BCIC) and Bangladesh Forest Industries Development Corporation (BFIDC).
The state entities have taken funded loans of Tk86.34 billion from the five banks and non-funded loan of Tk11.63 billion as LC guarantee.
Bangladesh Sugar and Food Industries Corporation (BSFIC) received Tk66.11 billion from five banks as funded loan and Tk89.5 million as non-funded loan.
The three commercial entities, Bangladesh Petroleum Corporation (BPC), Bangladesh Jute Mills Corporation and Trading Corporation of Bangladesh (TCB), borrowed Tk20.67 billion from the banks.
Of this amount, Bangladesh Petroleum Corporation took the highest amount of Tk17.55 billion.
Three state-owned banks—Sonali, Janata and Rupali—provide a loan of Tk22.76 billion to Bangladesh Agriculture Development Corporation for agriculture and fisheries sector. Of this, Sonali Bank provided Tk14.94 billion, Janata Bank Tk7.6 billion and Rupali Bank Tk212.6 million.
The five banks’ unrealised loan of Tk78.91 billion lie with five companies of gas, water and power sectors.
The companies are Bangladesh Power Development Board, Dhaka Power Distribution Company, Chittagong Water Supply and Sewerage Authority, Dhaka WASA and Petrobangla, Oil-Gas and Mineral Corporation. Of this, Bangladesh Power Development Board alone owes Tk75.5 billion.
The five banks also have an unrealised loan of Tk56.77 billion to six companies in the transport and communications sector.
The six companies include Bangladesh Shipping Corporation, Bangladesh Inland Water Transport Corporation, Chittagong Port Authority, Mongla Port Authority, Bangladesh Biman and Bangladesh Road Transport Corporation.
Of this, Biman owes Tk54.77 billion alone to Sonali Bank.