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Wednesday | October 07, 2026 | Dhaka

Loan recovery poor

 New Nation
 Published: 12:00 AM, 23 October 2016

Kazi Zahidul Hasan :
Poor loan recovery from big borrowers has badly affected on the solvency of public commercial banks forcing the central bank to issue directive on the banks for taking credit squeezing policy.
State-owned commercial banks – Sonali, Janata, Agrani and Rupali – have altogether fixed Tk 1,150 crore annual loan recovery target from top 20 defaulters.
But they recovered only Tk 221.69 crore (18.40 per cent) against the target till June 30 this year.
Sonali Bank recovered only Tk 5 crore in the first six months of 2016 against the annual target of Tk 440 crore, Janata Bank Tk 129 crore against Tk 270 crore, Agrani Bank Tk 1.69 crore against Tk 290 crore and Rupali Bank Tk 76 crore against Tk 150 crore.
Referring to the figure, Shuvankar Saha, spokesperson of Bangladesh Bank (BB) told The New Nation on Saturday that public banks are apparently struggling to recover loans from big borrowers. This has badly affected their financial solvency.  
“Such a poor credit recovery indicating they are not sincere about the task. They are lagging far behind their target due to lack of proper initiative,” he added.  
He also said that not only loan recovery position, their other financial indicators are also declining leading them into deep crisis. “We are concerned over the deteriorating financial health of state-owned banks and asked them to intensify their loan recovery drive to improve their solvency,” he said. The authorities of BB raised the issue at a meeting with the authorities of public commercial banks last week at its headquarters with governor of the bank in the chair. “Our governor asked the bank authorities to give a pause on disbursing large loans to reduce risks associated with such loans. He also asked the banks to concentrate more on disbursing SME loans rather than large ones to remain in safe side,” he added.
According to the latest BB data, the capital shortfall of Sonali Bank stood at Tk 2,606 crore as on June 30, 2016, that of Janata Bank at Tk 664 crore, that of Agrani Bank Tk 200 crore and that of Rupali Bank at Tk 374 crore.
The BB asked the banks to take initiative to make up the capital shortfall by recovering non-performing loans.
The BB also asked the banks to reduce the number of loss-making branches as such type of branches of the SCBs increased significantly as of June 30, 2016.
The BB data showed that the number of loss-making branches of Sonali Bank stood at 290 as on June 30, 2016 from 124 as on December 31, 2015, that of Janata Bank 74 from 15, that of Agrani Bank 99 from 34 and that of Rupali Bank 126 from 10.