Bangladesh News

The classified loan of Sonali Bank increased by 83 per cent–or around Tk 4,300 crore–in the last six months as Bangladesh Petroleum Corporation (BPC) failed to repay its huge loan from the bank.

The amount of loan default of Sonali Bank was Tk 5,105 crore in December last year, which was 23 per cent of the total loan, and the figure reached Tk 7,564 crore–33 per cent of the total loan–in March, sources in the bank said.

The amount increased further to Tk 9,364 crore, constituting 41 per cent of the total loan, in June.

“Apart from the provision shortfall, the huge loan default has reduced the bank’s profits,” a senior official of Sonali Bank said recently.

The bank is discussing the crisis with the BPC officials and has already asked them to reschedule the loans, he added.

The Sonali Bank appealed to the finance ministry last month to waive the penalty against its failure to maintain Statutory Liquidity Ratio (SLR), but the Bangladesh Bank (BB) opposed it.

“The Sonali Bank has to cough up a penalty of Tk 70 crore since October last year,” a Sonali Bank official said.

The government recently waived the penalty against failure to maintain the SLR of the Oriental Bank following BB recommendations, sources said.

After receiving the Sonali Bank’s letter in this regard, the finance ministry sought the central bank suggestions referring to the Oriental Bank case.

The Bangladesh Bank opposed the Sonali Bank plea and told the finance ministry that such waiver will encourage other nationalised commercial banks to take the opportunity.

“The penalty of the Oriental Bank was waived under a special situation,” a senior BB official said.