Scam-riddled BASIC Bank has failed to comply with the conditions imposed by the Bangladesh Bank for 2016 with the singular view of improving its financial health.

For instance, the bank last year went past the single borrower exposure limit, lending Tk 620 crore more than it is permitted to by the rule to a total of 20 clients, according to a BB report.

Alauddin A Majid, chairman of BASIC Bank, acknowledged the transgressions, adding that most of the loans were extensions of old loans.

Of the total excess loan amount, about Tk 200 crore were new loans, he said.

The BB had set a recovery target of Tk 1,118 crore from defaulted borrowers, but the state-run lender could manage only 12.5 percent of the sum.

The recovery from top 20 defaulters was more disappointing: it managed only 1.63 percent against the target of Tk 538 crore.

But the recovery from other defaulters was relatively better as the lender managed to collect nearly Tk 132 crore against the target of Tk 580 crore.

The recovery from bad loans was very poor last year as many of the clients who were given loans violating rules during the tenure of earlier board could not be traced, said a senior executive of BASIC Bank.

The bank failed to cut its default loans by Tk 1,974 crore last year. Instead, it went up by Tk 648 crore.

As of March, the lender's total default loans swelled and stood at 53.9 percent, or Tk 7,373 crore.  Furthermore, it failed to maintain the capital adequacy ratio. Its capital adequacy ratio went to 12.52 percent in the negative against the target of 10.6 percent.

Despite a capital injection of Tk 1,200 crore in 2015, BASIC incurred huge capital shortfall of Tk 2,684 crore at the end of December last year.

As of March, the capital shortfall was Tk 2,961 crore. BASIC focused on quality loan disbursement to overcome losses as it has huge deposits, according to Majid.

As of March, BASIC's advance deposit ratio, which measures loans as a percentage of deposits, was 99.26 percent, which is more than the authorised limit of 80 percent, according to central bank data.

The bank's loan growth last year was 5.54 percent against the BB-imposed ceiling of 12 percent.