Govt. banks to Loss 7700 crore; seek stimulus under bond facility

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Govt. banks to Loss 7700 crore; seek stimulus under bond facility

Government banks projected over Tk 7700 crore losses due mainly for suspension of interest and non-payment of loan installments.

The central bank kept suspended interest on all kinds of loans and advances for the Month of April and May which cost the bank over Tk 3200 crore losses. The banks will incur loss of another 3300 crore because stop payment of installments against disbursed loans until June.

Individual banks particularly projected their specific loss estimation and sent it to The Financial Institutions Division (FID) in writing last week, and sought capital support from the finance ministry.

Meanwhile, the FID had sent a proposal to the Finance Division seeking either bond facility or capital support for state-owned banks in the budget for the 2020-21 fiscal year.

Rupali Bank Managing Director and CEO Obayed Ullah Al Masud told Business Mirror that the remittance flow dropped significantly, which has slashed bank earnings from this sector. “We will also have to buy US dollars for a relatively higher price to pay import bills, which will increase the bank’s costs.,” Mr. Masud said

According to the FID report, Sonali Bank – the largest state-owned commercial bank in the country – is projecting losses amounting to Tk1,600 crore. Of the amount, Tk120 crore will be from increase in operating costs, Tk400 crore from a drop in interest earnings and Tk800 crore from the suspension of interest.

Besides, the bank is projecting losses of Tk100 crore due to decreasing earnings from commission, fees, exchange and brokerage, Tk150 crore from cash, fund transfer and treasury sectors and Tk30 crore from the capital market.

Janata Bank projected Tk1,593 crore, Agrani Bank Tk1,015 crore, Rupali Bank projected Tk855 crore.

According to the FID report, Basic Bank – an institution already mired in a loan scandal – will lose Tk319 crore and  The Bangladesh Development Bank has projected a loss of Tk150 crore.

Bangladesh Krishi Bank has projected lose Tk440 crore, Rajshahi Krishi Unnayan Bank Tk89 crore, Probashi Kallyan Bank Tk142 crore , Karmasangsthan Bank Tk123 crore, Ansar-VDP Unnayan Bank Tk316.25 crore,

Bmirrorhttps://bmirror.net/
businessmirror20@gmail.com

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