The Metropolitan Chamber of Commerce and Industry yesterday condemned the complete disregard for banking regulations that led to a large-scale scam involving Sonali Bank Ltd and its customer Hall-Mark Group.

"The loan scam of Sonali Bank, the largest of the country's state-owned banks, has come as a rude shock to us," MCCI said.

Dishonesty of bankers and lax management of banks that resulted in the global financial crisis of 2008-2009, shutting down many banks in the developed world, should have been a lesson for Bangladesh Banks, MCCI said.

"The business community is deeply concerned at the disclosure that a single branch of Sonali Bank extended unauthorised loans worth Tk 36.06 billion to five business houses in total disregard of the banking sector rules and regulations.”

“Of this amount, Tk 26.68 billion was lent to a single borrower.”

Blaming weak governance and non-prudent supervisory mechanism of the Bank for such long-term irregularities, MCCI expressed concerns over the inefficiency of regulatory bodies responsible for monitoring the activities of the Bank and the banking sector.

“We also wonder how, despite the information of irregularities reportedly supplied by its internal auditors to the branch management and subsequent warnings of Bangladesh Bank, such big amounts could be unlawfully lent by the Bank branch without being noticed by the higher administration and the board of directors of the Bank,” it said.

The chamber expressed happiness with the parliamentary standing committee on the finance ministry that set up a panel to look into the loan scam and appreciated steps taken by the Bangladesh Bank and Anti-Corruption Commission.

MCCI backs complete independence of the central bank to properly play its regulatory role in the banking sector.

The chamber appreciated the encouragement the finance minister's gave to the business community by saying that the Sonali Bank scam will not have an adverse effect on the banking sector.

MCCI urged the government to unearth and punish the irregularities of the Bank officials and some vested quarters of the business community, recover the scammed amount from defaulters, and enforce transparent and efficient governance of banks to prevent any such scandal in future.

News: The Daily Star/Bangladesh/06-Sep-12