Business Report :
The Shariah-compliant Union Bank has incurred a loss of Tk80 crore in the July to September quarter due to “low profitability”, according to a price-sensitive statement from the bank.
During the same period last year, the private sector lender enjoyed a profit of Tk54 crore.
In August, the Bangladesh Bank restructured the board of Union Bank and dissolved the boards of seven other banks controlled by the controversial Chattogram-based S Alam Group. The central bank appointed five independent directors to oversee Union Bank.
Under Sheikh Hasina’s regime, Union Bank extended Tk17,229 crore in loans to 247 entities affiliated with the S Alam Group – making up 64per cent of the bank’s total lending, mostly unsecured, according to a recent Bangladesh Bank inspection report.
To address liquidity issues, the central bank also permitted Union Bank to borrow from interbank sources on 22 September, with Tk150 crore already approved under this facility.
As of Thursday, Union Bank’s share price closed at Tk5.30 on the Dhaka Stock Exchange.
During this time, the bank reported a loss per share of Tk0.77, while it had earnings of Tk0.52 a year ago.
For the January to September period, the bank’s net profit stood at Tk15 crore, a significant decline from Tk140 crore in the same period of 2023.
Its earnings per share (EPS) for this period were Tk0.14, down from Tk1.35 a year earlier. As of the end of September 2024, its net asset value per share was Tk15.41.
Union Bank, along with eight other banks, was approved for operation in 2012 under the Sheikh Hasina’s administration, reportedly due to political considerations.
As of September, the shareholding structure consisted of 54.49per cent held by sponsor-directors, 15.44per cent by institutions, and 30.07per cent by the general public.
