USD 35 million approved on expansion of the luxury hotel

Managing Director of Unique Hotel & Resorts Ltd. Mohd. Noor Ali signed a US$ 35 million foreign currency loan agreement recently with Standard Chartered Bank to fund the company's expansion plans into the hospitality sector. CEO, Standard Chartered Bank Bangladesh Abrar A. Anwar also seen.

Standard Chartered Bank and Unique Hotel & Resorts Limited (owner of The Westin Dhaka) signed an agreement recently to fund UHRL's ongoing expansion programmes into the hotel sector, said a statement.

Mr. Mohd. Noor Ali, the Managing Director of Unique Hotel & Resorts Ltd. signed the agreement on behalf of UHRL. Mr. Abrar A Anwar, CEO, Standard Chartered Bangladesh was also present on the occasion.

Unique Hotel & Resorts Ltd. is the owner of The Westin Dhaka - an internationally branded chain hotel in Bangladesh. The company has plans to set up two internationally branded 5 star hotels at Gulshan and Banani in Dhaka. Standard Chartered Bank has approved USD 35 million term loan to fund the on-going expansion programmes of Unique Hotel & Resorts Ltd.

On this occasion, Mr. Mohd. Noor Ali, MD of UHRL said, "This landmark deal will help Unique Hotel & Resorts Ltd. to lower its funding cost by availing financing in foreign currency and further consolidate its position as leading player in the hospitality sector in Bangladesh. We are really happy to sign this agreement with Standard Chartered Bank, as they are providing an innovative financial solution that will benefit us and our shareholders immensely."

Mr. Abrar A. Anwar, CEO, Standard Chartered Bank Bangladesh said. "We are really pleased to come up with such a solution for Unique Hotel & Resorts Ltd. This agreement is another testimony of our commitment to continuously innovate and provide the best financial solution to our clients and customers and also to bring global best practices to Bangladesh."

Bangladesh Bank (BB) has asked the First Security Islami Bank (FSIB) not to offer cash dividend for the year 2014 because of its provision shortfall.

Bangladesh Bank sent a letter to the bank yesterday with an instruction for not announcing any cash dividend, according to BB sources.

On the other hand, the FSIB board of directors is scheduled to sit today to decide on the dividend issue for the year 2014, considering the audited financial statements of the bank.

A primary investigation of the central bank conducted over the quick report of the FSIB has found the provision shortfall of Tk15 crore at the year-end of 2014.

Of the shortfall amount, the bank maintained only Tk3 crore in December last year. However, The bank has requested the central bank for an exemption from provisioning the rest of the amount of 12 crore till the year 2015.

In response, Bangladesh Bank allowed the bank to maintain the shortfall in two phases by June and September quarter this year.  At the same time the bank has been asked not to provide any cash dividend to the shareholders.

Bank company act also does not allow cash dividend for a company that suffers from provision shortfall.

Earlier, at the bankers meeting held December last year, the top managers had demanded for allowing banks to offer cash dividend to the shareholders, which is now prohibited as a pre-condition of the exemption in provisioning.

The banks were given the provision facility, against the losses they incurred through investing in the capital market in 2010, on a condition that they won’t be able to declare cash dividends.

Meanwhile, First Security Islami Bank made a decision to announce 10% cash dividend for last year, as the company was not in a shortfall before the investigation by the central bank, said a senior executive of Bangladesh Bank.

Though the maintained provision was Tk268 crore in the quick review report prepared by the bank, the investigation team of the central bank identified more accounts as classified, which caused the provision shortfall of the bank, he said.

The bank showed huge operating profit of Tk221 crore in the year 2014 but the net profit came down to only Tk67 crore due to more provisioning, he observed.

The bank had declared 10% cash dividend to the shareholders in the year 2013. It is running with paid up capital of Tk617 crore.

The non-performing loans of the bank stood at Tk340 crore at the end of December last year from Tk248 crore in the same period of the previous year, according to the Bangladesh Bank data. 

Bangladesh Bank Governor Atiur Rahman has expressed dissatisfaction as BASIC Bank’s sacked top officials have not been arrested yet despite allegations of huge anomalies.

The bank’s ex-chairman Sheikh Abdul Hye Bacchu and managing director Kazi Faqurul Islam were removed from the posts over the allegations of involvement with the Tk4,500 crore loan scam.

“It’s very sad that the two have not been arrested yet. But they face allegations of direct involvement with the financial irregularities in the BASIC Bank,” Atiur Rahman lamented at a meeting of the Parliamentary Standing Committee on Finance Ministry recently.

When contacted, Anti-corruption Commission Chairman M Badiuzzaman yesterday told Dhaka Tribune that they are investigating into the allegations against the bank’s former top brass.

“We are inquiring into the allegations, after which, cases will be filed. Then the issue of arrest will come,” he said.

On May 25 last year, the central bank removed Kazi Faqurul Islam on the charge of the irregularities. 

On July 6, Sheikh Abdul Hye Bacchu stepped down after facing the allegations.

Last month, the central bank directed the management of the crisis-ridden bank to reduce the volume of non-performing loans through intensifying recovery derives.

The overall NPL of the bank rose to Tk6,148 crore as of September 30 last year from Tk1,863 crore a year ago, according to the central bank data.

Earlier, the central bank had found various irregularities in the BASIC Bank in giving out loans, which include no verification of customers’ credit worthiness, absence of know-your-customer procedures, and providing loans to defaulters.

Bangladesh Bank investigations found financial irregularities involving around Tk4,500 crore  worth of loans in three branches of BASIC Bank, located in Gulshan, Dilkusha and Shantinagar in the capital. 

M Nazeem A Choudhury, head of consumer banking at Eastern Bank, and Sohail Majid, head of sales and marketing at Novoair, sign an agreement at a programme in Dhaka recently. The bank's cardholders can now buy Novoair's holiday package for Cox's Bazar without any interest through a six month instalment plan.

Eastern Bank has teamed up with Novoair to offer the bank's cardholders a holiday package for Cox's Bazar with a flexible payment plan, the bank said in a statement yesterday.

EBL cardholders can now pay for the airline's holiday package in up to six monthly instalments, under the bank's zero instalment programme.

Travellers who make a two-way trip from Dhaka to Cox's Bazar by Novoair will enjoy free return tickets and accommodation in any of the hotels like Sayeman Beach Resort, Ocean Paradise, Seagull, Long Beach and Praasad Paradise, it said. 

The offer will remain valid until June 30.

M Nazeem A Chowdhury, head of Eastern Bank's consumer banking, and Sohail Majid, head of sales and marketing of Novoair, signed an agreement in Dhaka recently. 

A file photo shows a man using ATM at a booth in Dhaka. Bangladesh Bank is going to put a cap on annual fee of debit cards offered by scheduled banks as some of them impose excess charge on their clients for using the product.

Bangladesh Bank is going to put a cap on annual fee of debit cards offered by scheduled banks as some of them impose excess charge on their clients for using the product. A BB official told New Age on Tuesday that the central bank was likely to impose annual charge between Tk 300 and Tk 400 for all types of debit cards of the banks in a bid to popularise more the online-based transaction. The banks are now imposing annual charge on the debit cards between Tk 300 and Tk 2,000 which is impeding to expedite the card-based transaction through automated teller machine and point-on-sale, he said. The central bank will also take an initiative to allow the clients to enjoy the debit card service without any annual fee if they make a certain amount of transaction through their cards, he said. Besides, the BB will impose caps on card and PIN replacement fees for the banks as the charges are also high considering the existing rate, the official said. The central bank, however, is yet to set the limit, but the decision will be taken in the quickest possible time, he said. The BB will raise the issue at a bankers’ meeting which will be held on March 19 at the central bank headquarters in the capital. After the meeting, the central bank will make a final decision in this connection and issue a circular to all banks, the BB official said. The banks issued 72,85,805 debit cards and 5,77,864 credit cards and 1,02,787 prepaid cards as of September 30, 2014 while they set up 6,035 ATM booths and 26,140 POS terminals, according to the latest BB data. The clients will encourage more to make their transaction through the debit cards if the banks reduce their fee on the cards, the official said. Such type of transaction will also reduce the use of printed currency note and coin, he said. ‘The central bank will also impose a cap on annual fee of credit cards after making a decision about debit cards’, the official said.