• Wednesday, Nov 13, 2019
  • Last Update : 01:30 am

A bad loan too many

  • Published at 10:58 pm July 8th, 2019
Photo: BIGSTOCK
Photo: BIGSTOCK

It is a matter of some concern that the amount of non-performing loans has continued to rise

For the longest time, our banking sector has been suffering from a crisis that could potentially bring our entire economy to its knees.

As such, we appreciate Bangladesh Bank’s initiative to form a cell dedicated solely to monitoring top loan defaulters in the country and ensure that the amount does not get out of hand which, some would argue, already has.

Indeed, it is a matter of some concern that, despite repeated warnings from experts, the amount of non-performing loans has continued to rise, with the amount jumping by a staggering Tk16,962 crore in the first three months of this year alone.

This brings the total amount to a whopping Tk1,10,873.54cr -- the largest ever in the country’s history -- and if we allow this culture of increasing default loans to continue, it would wreak havoc within the economy, stopping the impressive economic progress we are making in its tracks.

What is doubly concerning, and this bears repeating, is the fact that most of the institutions guilty of bad loans have been state-owned banks, which essentially means that these loans are being written off with tax-payers’ hard-earned money.

In this regard, this cell -- which will consist of 11 of the country’s banks with large amounts of non-performing loans -- will go a long way towards ensuring that the culture of nepotism and corruption which has contributed to the current situation is reduced and the problems within the banking sector are stamped out.