• Sunday, Nov 27, 2022
  • Last Update : 09:54 am

Banking sector face Tk12,897cr provision shortfall as of June

  • Published at 04:27 pm August 25th, 2019
Bank-provisions.jpg

Thirteen public and private sector banks are on the list, according to the Bangladesh Bank latest data

The banking sector faced a combined provisioning shortfall of Tk12, 897crore at the end of June this year, exposing their faltering financial health.Thirteen public and private sector banks are on the list, according to the Bangladesh Bank latest data. 

Of the 13 banks, four are state-owned, while the remaining nine are private commercial banks.

The thirteen banks are Sonali Bank, Agrani Bank, Rupali Bank, BASIC Bank, AB Bank, Bangladesh Commerce Bank, Dhaka Bank, Mutual Trust Bank, National Bank, Standard Bank, Shahjalal Islami Bank, Social Islami Bank and Trust Bank. 

Some of the banks faced provisioning shortfall because they lent a large amount of funds in violation of banking regulations, it was alleged.

According to experts, the rising trend of defaulted loans in the banking sector is largely responsible for the huge provisioning shortfall. 

According to the central bank data, the Agrani Bank’s shortfall stood at Tk852.88crore, BASIC Bank's at Tk3,073.5crore, Rupali Bank's at Tk982.73 crore and Sonali Bank's at Tk1942.2crore during the period.

The provision shortfall of AB Bank stood at Tk3,593.5crore, Bangladesh Commerce Bank's at Tk511.11crore, Mutual Trust Bank's at Tk126.45crore, Dhaka Bank's at Tk329.58crore, National Bank's at Tk727.83crore, Shahjalal Islami Bank's at Tk100.3crore, Social Islami Bank's at Tk370crore, Standard Bank's at Tk103.34crore and Trust Bank's provisioning deficit stood at Tk183.61crore.

As per central bank regulations, banks have to keep 0.50% to 5% provision with Bangladesh Bank against defaulted loans for general category, 20% against classified loans of sub-standard category, 50% against classified loans of doubtful category, and 100% against classified loans of bad or loss category.

The capital base of the 13 banks will erode significantly as they have to keep provisioning as per the central bank rules, says a Bangladesh Bank official.

Non-performing loans (NPLs) of banks rose by a staggering Tk1,551crore in three months till June this year, taking the amount of stress loan in the banking sector to Tk112,425crore.

50
Facebook 50
blogger sharing button blogger
buffer sharing button buffer
diaspora sharing button diaspora
digg sharing button digg
douban sharing button douban
email sharing button email
evernote sharing button evernote
flipboard sharing button flipboard
pocket sharing button getpocket
github sharing button github
gmail sharing button gmail
googlebookmarks sharing button googlebookmarks
hackernews sharing button hackernews
instapaper sharing button instapaper
line sharing button line
linkedin sharing button linkedin
livejournal sharing button livejournal
mailru sharing button mailru
medium sharing button medium
meneame sharing button meneame
messenger sharing button messenger
odnoklassniki sharing button odnoklassniki
pinterest sharing button pinterest
print sharing button print
qzone sharing button qzone
reddit sharing button reddit
refind sharing button refind
renren sharing button renren
skype sharing button skype
snapchat sharing button snapchat
surfingbird sharing button surfingbird
telegram sharing button telegram
tumblr sharing button tumblr
twitter sharing button twitter
vk sharing button vk
wechat sharing button wechat
weibo sharing button weibo
whatsapp sharing button whatsapp
wordpress sharing button wordpress
xing sharing button xing
yahoomail sharing button yahoomail