Just over a month or so after a whole-scale purge of the top echelon, Islami Bank is in the news for all the wrong reasons. Year after year, it emerged as the best run bank of the country enjoying shareholder and depositor confidence; year after year it ranked as one of the best in Asia. Fast forward to 2017 and it comes under the Bangladesh Bank scanner for not having followed due process and diligence in two or three of its loans. The decisions were approved, as per reports, by the bank's board, restructured to cleanse the money-laundering, terrorism financing and politically-tainted image smeared top leadership. The newly appointed Managing Director was categorical in saying he had joined an efficient team.
In an earlier write-up, this scribe had pleaded that evident wrongdoing must be tackled but the essence, that of a well-oiled operation shouldn't be disturbed. Sadly, it would appear that the one bank hitherto unblemished by dubious dealings of unscreened loans, is now heading the same way as most of the public sector banks as a source to be looted and pillaged. The accusations of terrorism financing and money-laundering haven't made it from the accusation to proof stage yet and unless there is someone firm enough to step in there could be another disaster in the making.
Overseas shareholders have made known their displeasure over the way the restructuring has been done, though local management have stuck to their guns about due process. With massive shortfall in capital, thanks to unacceptable siphoning off of funds, six to seven banks are depending on the government to bankroll their existence. One doesn't need an expert to figure out that will have to be financed from tax payers' money. An inability or unwillingness to pick up those behind the scams has led to more than erosion of confidence in the financial sector, it is also scaring off official remittances. With numbers of workforce consistently heading overseas for work, the argument about low oil prices and economic scale down in the Gulf countries is beginning to ring a little hollow. So much so that two teams are shortly travelling to ascertain the truth. On their return an official statement is expected but there are doubts whether that will be reality or stage-managed.
Inaction over the stock market crashes and the inexplicable delay or otherwise in releasing the facts behind the now-famous but fading-from-memory foreign reserve heist isn't clearing the air. Official remittances are at their lowest for some time now but there are no real statistics to suggest money isn't being sent back to the country through the hundi channel. If that is so, the informal economy gets a further fillip and all the good work and expense of facilitating the official process will have gone to waste. For those who point to devaluation of international currencies, perhaps it isn't sinking in; the world economy isn't contracting so obviously something is working that we aren't privy to
[email protected]
- Saturday, 23 November 2024 |
- Today's FE |
- e-Paper |
- Beta Website
