Mohosinul Karim

Though the draft of the proposed “Palli Sanchay Bank [Rural Savings Bank]” is still waiting in the parliament for passage, the authorities have already started preparation to set up around 100 upazila branches for the bank.

The “Ekti Bari Ekti Khamar [One House One Farm]” project authorities had allocated money for constructing own buildings for the 100 branches of the bank. Rest of the branch offices would be built phase by phase, Project Director Dr Prosanta Kumar Roy told the Dhaka Tribune yesterday.

The government has decided to set up the Palli Sanchay Bank for the poor to reduce poverty, realising the “Ekti Bari Ekti Khamar” project for the rural development under the LGRD Ministry.

The draft of the Rural Savings Bank Act 2013 was prepared by the Rural Development and the Cooperative Division to establish the bank, which was approved by the cabinet meeting on November 10, 2013.

Dr Roy said the draft of the act was waiting in the parliament to get its nod for setting up the bank. It was expected that it would get approval of the parliament soon to eliminate poverty of the country.

It would be a unique initiative in the country, even in Saarc countries to set up such a bank funded by the savings of the poor beneficiary groups of the project and would be established with 100% online banking system as the existing system of online transaction of the project would be handed over to the bank, the project director said.

He also said the proposed bank for the poor people would be established so that the rural people could utilise their savings for a better life, and change their fate.

“Its banking activities will be started after the bill is passed in the parliament. But, we have already started the process of building own offices for the bank as its banking activities is already going on. We will just hand over the assets and resources to the bank,” he added.

“We are hopeful that the branches of the bank will be set up in all the upazilas by this year and gradually it will be opened at union level.”

He said the way the “One House One Farm” project had been showing a new path in poverty alleviation, the same way the “Palli Sanchay Bank” would help rural people build their fortune themselves and shield them from the high interest charged by microfinance institutions. The bank members would get loan at less than 10% interest. The initiative of the government would reduce poverty of the country to below 20% by 2015 from the present rate of 29.75%, he opined.

The project director also said the number of beneficiaries from the project was 21.6 lakh under around 36,000 societies across the country. The savings of the beneficiaries had already risen to Tk570 crore, he added. The government had given Tk355 crore as bonus for the members according to its terms and conditions.

Total investment of the project is around Tk925 crore while over Tk579 crore was distributed among the members. Earlier, the project director briefed some reporters about the progress and success of the project.

He said the project was expecting that it would be possible to create a fund of around Tk9 lakh for each society under the project. It would be created with the contribution of the members and donation of the government.

News:Dhaka Tribune/25-May-2014

The bank took the initiative for introducing computerised system in all the branches recently as part of its overall development plan to provide modern banking service to the clients, said Rupali Bank chairman Dr. Ahmad al- Kabir.

‘’We have started automation system, ATM service into the banks to conduct competitive banking activities as like as the other banks’’, he said.

“We will introduce online banking system in the rest of 131 branches soon.”

The bank has established 40 ATM booths in different districts across the country. Clients of 58 branches of the bank are getting the ATM service.

News:Dhaka Tribune/25-May-2014

Asif Showkat Kallol

In a bid to recapitalise four ailing state-owned banks, the government has decided to set aside Tk5,000 crore for the next fiscal year as per a recommendation by the International Monetary Fund under its extended credit facility (ECF) programme.

Seeking anonymity, a senior official of the Finance Division who is involved with budget preparations, said the government had no choice but to allocate the funds in the next budget as they were concerned about the financial health of four state-owned commercial banks in Bangladesh – Sonali, Janata, Agrani and Rupali.

The government gave Tk4,100 crore to the four banks in the outgoing fiscal year to help the banking sector recover from the setbacks caused by the Hall-Mark and Bismillah group scams, the official said.

Sources said the Finance Division would allocate the Tk5,000 crore only after reviewing whether the state-owned commercial banks had made substantial progress regarding an agreement with the central bank that had granted the previous Tk4,100 crore allocation.

The Finance Division would hold a meeting with the Bangladesh Bank to review the matter following the budget announcement, the sources added.  

In April, the International Monetary Fund (IMF) asked the government to put aside Tk5,000 crore in the upcoming budget as capital for the four state-owned banks.

In its fifth review of the ECF, the IMF suggested that Tk1,500 crore of the total amount should be dispatched to the four banks by December this year and the rest by June 2015.

The multilateral lender, however, has instructed that certain conditions be tagged with the handout, so that the four banks are obligated to improve their performance and automate their branches by 2016.

The move comes after the IMF forecasted that the four banks’ capital position would deteriorate fast in the coming fiscal year, even though they have a capital surplus of Tk855 crore, according to the latest available data from December 31 last year.

According to Bangladesh Bank, the loan provision surplus of Sonali Bank and Janata Bank stood at Tk80.98 crore and Tk204.80 respectively at the end of March; the loan deficit of Rupali Bank stood at Tk319.92 crore; while Agrani Bank had no surplus or deficit provision of credit.

The banks’ capital position would run into a deficit for several issues, including the expiry of the central bank’s relaxed loan rescheduling policy in June, provisioning requirements for impending classified loans, and the shift in July to BASEL III standard which requires higher capital adequacy.

Meanwhile, the Bank Division of the Finance Ministry had sought Tk6,000 crore allocation in the upcoming budget for recapitalisation of the four state-owned banks, as well as seeking Tk700 crore for the same purpose for the state-owned specialised banks.

M Aslam Alam, secretary of the Bank and Financial Institutions Division, told the Dhaka Tribune that the four government banks needed more capital in the next fiscal year in line with Basel II.

Basel II, published in 2004, is an accord that intends to create an international standard for banking regulators to control how much capital banks need to put aside to guard against risks.

The four state-owned commercial banks are said to have been robbed off their safe footing by major scams such as those staged by the Hall-Mark and Bismillah groups.

“The balance sheets of the state banks should be streamlined in order to ensure their survival... The development partners think that the state banks may collapse because of capital shortfall. So, they want to see recapitalisation in steps,” the secretary said.

News:Dhaka Tribune/21-May-2014

The makeshift field workers of the state-owned Agrani Bank limited have demanded for job obsession to the field workers who were engaged in loan disbursement and recovery to the farmers in the bank.

The makeshift field workers came up with the demand while addressing  a human shield program in this regard, in front of the National Press Club, in the capital, on Monday.

In terms of the development of agriculture besides the farmers of the country, the bank has appointed a total of 1,200 field workers in 2010.

“The field workers were assured that their job would be permanent but the bank authority has not implemented, yet,” the speakers alleged in the human chain program.

The joint-conveyor of the Field Assistant Parishad of the bank Md Bashir Uddin Mollah, Md Shahin Alam, Md Rafiqul Islam Shanta also spoke, among others, at the program while the conveyor of the parishad Jahirul Qyeeum Rana was in the chair.

United Commercial Bank Ltd (UCB) has recently signed an agreement with Grameenphone Ltd to provide UCB Mobile Financial Services “UCash” to customers via Grameenphone’s MobiCash distribution network.

Mir Jahir Uddin Ahmed, executive vice president & head of Mobile Financial Service of UCB and Md Delwar Hossain Azad, head of Financial Services of Grameenphone were, among others, present at the signing ceremony.