BM Desk : Three more months have been granted by the Central Bank to complete Islami Bank Bangladesh’s annual report. The bank has until August 31st to turn in its yearly audit report. The Central Bank extended it by an additional three months in a notification following a meeting with the bank.
The annual financial report must be completed and delivered to the Central Bank by April of the following year in accordance with the Bank Companies Act. This time, though, the Central Bank gave it a month because a lot of institutions couldn’t finish their audited financial reports in time. May 31 was the last day of that deadline. But Islami Bank was unable to complete its report in time. Under these circumstances, the Central Bank has given the bank time till August.
In a March 13 policy, Bangladesh Bank stated that institutions that have used its deferral facility to cover other costs, such as provisioning, will not be eligible to receive dividend payments in 2024. Additionally, a bank won’t be able to pay dividends the following year if its loan default rate surpasses 10% from this year.
According to information obtained, the Central Bank has not exhibited any leniency in completing the financial statements this time. The majority of banks’ defaulted loans have therefore increased by two, three, or more times. The total amount of banking sector defaulted debts at the end of March was Tk 420,334 crore, or 24.13 percent. At the conclusion of December 2023, it was Tk 145,633 crore. This means that the actual data has increased almost threefold in 15 months.
As far as is known, the total amount of defaulted loans held by Bangladesh Bank at the end of last December was Tk 65,716 crore. This amounts to 42.22 percent of all loans. Since then, the bank has had to set aside Tk 77,533 crore in total. where it has only managed to retain Tk 7,717 crore. Consequently, the deficit is Tk 69,816 crore. The bank will incur higher expenses in international commerce if the yearly report is finalized with this significant deficit. There will be pressure to remove deposits and a lack of confidence once more. For this reason, it is known that additional time has been allotted to complete the bank’s statement.
