State-owned Janata Bank has racked up more loan defaults, more than all the 57 out of the 58 banks that have been listed for their loan defaults going up.
In the last one year, the loan default amount in the banking sector has risen to nearly Tk 200 billion. Janata Bank’s amount alone stands at Tk 104.77 billon while the rest of the banks combined have Tk 91.31 billion worth of loans that they have yet to collect.
A Bangladesh Bank publication said that as of December of 2018, Janata Bank’s loan default amount stood at Tk 162.93 billion which is 38 percent of the bank’s total loan distribution amount. In 2017 the amount was Tk 58.81 billion meaning that in the span of one year the default amount increased Tk 104.77 billion.
According to the central bank that one-fourth of the top 100 loan defaulters are from Janata Bank. Not only that, two organisations Crescent Group and Anontex Group together owe the bank Tk 100 billion.
Janata Bank’s Imamganj branch at Old Dhaka and Mohammadpur’s corporate branch have already been stripped off their authorised dealer’s licence over the Crescent Group loan fiasco.
Cancellation of the licence means that those branches can no longer facilitate foreign trade which has made a negative impact on it.
In 2017, 57 branches of the bank was in losses and by 2018, the number was 88. As a result the bank is having to take out short-term interbank loans everyday.
Former deputy governor of Bangladesh Bank, Ibrahim Khaled, says: “Janata was one of the reliable banks but it’s now mired in corruption.”
This has happened due to lack of monitoring, he added.
According to Bangladesh Bank report, institutions under Crescent exported leather products to Hong Kong and Thailand but the proceeds from the exports are not coming back to Bangladesh.
Janata Bank bought the export bills and gave money to the group.
One of the founders of the organisation, MA Quader was arrested on Jan 30. The law enforcers are still in the lookout for the second founder, Abdul Aziz Jaaz, owner of Jaaz Multimedia.
Law enforcers have found evidence that these two brothers laundered money worth Tk 9.19 billion.
Janata Bank Managing Director Abdus Salam Azad said that they are trying to reduce the loan default amount and was trying to retrieve the money.