In the past, influential people used to take loans from government banks and did not return it; now, this aberration also affects private banks.
Bangladesh Bank report says that while default loan for government banks has fallen in June quarter, it has risen for private ones.
In private banks, default loan has risen by Tk. 19.74 billion. At the end of March, the default loan was Tk 499.49 billion which rose to Tk 519.24 billion.
Former governor of Bangladesh Bank, Dr Salehuddin Ahmed, said: “The sickness afflicting government banks has moved to private ones and if this goes on, then banks will need a subsidy to survive like Farmers’ Bank.”
Relevant quarters say that due to the reckless loan taking of influential people, banks are facing a liquidity crisis. Reportedly, Islami Bank is in jeopardy when millions were withdrawn from it.
After a change of ownership, Islami Bank began to show falling rates in several indicators; now it cannot give loans due to the liquidity crisis.
Till March last, the default loan of Islami Bank stood at Tk 69.16 billion which is double the amount recorded in December 2018.
From April to June this year, the default loan in the banking sector has risen by Tk 15 billion.
Bangladesh Bank says that till June this year, distributed loan stands at Tk 9627.7 billion of which default is Tk 1124.25 billion.