Grameen Bank set to post 'highest profit' in 2022

Record amount of loans recovered in 11 months, Grameen Bank chairman Prof. AKM Saiful Majid tells FE

| Updated: December 28, 2022 09:07:01

Prof AKM Saiful Majid Prof AKM Saiful Majid

The microcredit pioneer Grameen Bank has recovered a record amount of classified loans in the past 11 months of the outgoing year 2022.

All other indicators also showed positive developments.

In contrast to loan defaulting and recovery trends in the country, the Nobel Prize-winning bank recovered Tk 1.59 billion until November 30.

"This is the first time the balance of bad debt reduced in the history of Grameen Bank," said Grameen Bank chairman Prof AKM Saiful Majid in an exclusive interview with the FE.

The bank has grown vigorously amid its rapid transformation in human resources, technical development, reduction in interest or service charge and strong monitoring over the last two and half years.

"We're now trying to make a strategy to revitalise the growth of Grameen Bank," he said, adding that the bank will also show the highest profit in 2022.

He said the bank has now reached out to 96-per cent villages to change the livelihoods of the poor by supporting their socio-economic transformation.

The number of members of the bank rose by 800,000 to 10.2 million from 9.4 million until November 2022.

Dr Saiful Majid, a former director of the Institute of Business Administration (IBA) at Dhaka University, joined the board of the microcredit lender as chairman on 24 March 2020.

Grameen Bank started its operations formally in 1983 under an ordinance that was repealed through the passage of the Grameen Bank Act-2013 in parliament.

The organisation has disbursed collateral-free loans of $34.01 billion since its inception.

The recovery rate is 97.22 per cent, according to the official data.

Mr Majid said the bank had a very serious problem in HR management with no guideline for promotion and evaluation of the staff based on performance.

"Many staffers were working here in the same position for years for a discriminatory role of the management, so we formulated an HR guideline in August 2020."

"Since then," he said, "employees are being evaluated based on their performance."

HR management is the key to the positive growth in all sectors, the chairman said, adding that they have evaluated and promoted 7,000 employees countrywide.

Official data shows all the zones of the bank are now 100-per cent profit-making, whereas 2,496 branches or 99 per cent are profit-making.

Mr Majid said Grameen Bank posted the Tk4.57-billion profit until October 2022, the highest in its history.

The bank has 11 schemes with insurance facilities for poor women, learner children, entrepreneurs, beggars and other underprivileged communities.

It now accepts monthly instalments replacing the weekly model.

"The bank now issues loan for improving the livelihoods of the poor. For example, we introduced a credit programme for beggars, which we termed Sangrami Sadosso (struggling members)."

The bank provides collateral-free loans to help them come out of the discreditable profession.

It does not charge any interest on study loans for the children of its members until they complete graduation.

The organisation has planned a digitalization project for developing an enterprise resource planning system.

Mr Majid said Grameen Bank is the world's largest micro-credit organisation. "And we want to continue with this legacy."

An estimated 2,000 employees are working across 2,568 branches and at the headquarters of Grameen Bank. The 13-member management board comprises nine directors from beneficiaries, three state-appointed directors and the managing director of the organisation.

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