The central bank's attempts to steady the ship at BASIC Bank have been met with a huge setback after the troubled lender failed to meet the majority of the targets laid out in an agreement signed last July.

A high official of the central bank said the state-owned bank's reckless lending continued even after the signing of the agreement, which was drafted in after massive irregularities were unearthed.

The agreement obliged BASIC Bank to limit its single borrower exposure to 15 percent of the bank's total capital, but it overshot the ceiling for 61 of its clients, giving out Tk 2,111 crore more in loans than it should.

Bangladesh Bank stipulated that the state-owned scheduled bank raises its capital adequacy ratio (CAR) to 11 percent by the end of 2013. The CAR on December 31 last year stood at 4.5 percent.

It was also supposed to make up the capital shortfall of Tk 128.21 crore in 2013, but in reality, the capital deficit widened to Tk 647.38 crore by the end of December.

The state-owned scheduled bank also fell short in cash recovery last year: it was supposed to be a minimum of Tk 212 crore but BASIC Bank managed Tk 142.82 crore.

The troubled bank's non-performing loan ratio by the end of 2013 needed to be 5 percent, but it stood at 11.72 percent.

Another target was to transform the loss-making branches into profitable ones during the course of the year, which, again, it failed to. Of the total of 68 branches, 33 remain loss-making.

Bangladesh Bank also put a ceiling on BASIC Bank's loan growth in 2013: it was first set at 10 percent and later upon the bank's request it was extended to 20.63 percent.

Even then the state-owned scheduled bank fell short: its loan growth on December 31 last year stood at 25.26 percent.

Subsequently, the central bank as per the Bank Company Act 1991 enforced a penalty of Tk 10.02 crore.

BASIC Bank, however, maintains that its loan growth in 2013 stood at 18.5 percent, and has appealed for the withdrawal of the fine.