Over the last few years, the banking sector of Bangladesh is in deep trouble. Relentless corruption and political influences took the sector into abyss and a latest Bangladesh Bank report found some of big public banks are in serious jeopardy.
Janata Bank, Agrani Bank and Rupali Bank are the three big names which were categorised in the red zone meaning their financial condition is in alarming state. The other six banks which are in this danger zone are Bangladesh Commerce Bank, Padma Bank, BASIC Bank, National Bank of Pakistan, National Bank and AB Bank.
The BB’s financial stability department has recently prepared banks’ health index and HEAT map on the basis of June 2023 ending half-yearly financial performance. It also found out that only eight local banks are in good condition while eight other foreign banks are in the green zone.
According to that report, eight local banks – Prime Bank, Eastern Bank, NCC Bank, Midland Bank, Bank Asia, Shimanto Bank, Jamuna Bank, Shahjalal Islami Bank are in good condition while eight other foreign banks Bank Alfalah, Woori Bank, HSBC, Commercial Bank of Ceylon, City Bank NA, Habib Bank, Standard Chartered Bank and State Bank of India are in green.
According to the report the green zone designated the banks which have good financial health.
But the worrisome thing is that as many as 29 banks are in the yellow zone, meaning their condition is in danger. They may not be as fragile as to be liquidated but they are in between good and fragile. The biggest state-run one, Sonali Bank Limited, also fell into this category. Bangladesh Development Bank is also grouped in the same zone.
As many as 19 conventional private commercial banks and eight Shariah-based islamic Banks make this group the biggest one.
The 19 conventional banks are IFIC Bank, Meghna Bank, One Bank, United commercial Bank, NRB Bank, NRB Commercial Bank, Mercantile Bank, Mutual Trust bank, Dutch-Bangla Bank, Premier Bank, BRAC Bank, Southeast Bank, The City Bank, Trust Bank, SBAC Bank, Modhumoti Bank, Dhaka Bank, Uttara Bank and Pubali Bank.
The eight Sharia-based banks are First Security Islami Bank, Islami Bank Bangladesh, Social Islami Bank, Al Arafah Islami Bank, Standard Bank, Union Bank, Exim Bank and Global Islami Bank.
The report asked for supervision of the yellow zone banks and special attention to red zone banks. But the situation will deteriorate even more if the policy and practice of using the banks for political gain is stopped.
The Boxer: The author is one of the indefatigable working-class Bangladeshis who have been trying to change the fate of the nation but were betrayed by the ruling elites and autocrats. The name is inspired by a character in George Orwell's 1945 novel Animal Farm.