If there is any sector in the entire country that is in desperate need of restraint, and perhaps even some discipline, it is our banking sector.
The number of loans defaulted has been increasing every three months after the relaxed loan classification policy was withdrawn, with it having surpassed all prior records and establishing a new benchmark in the second quarter of the current calendar year. The Non-Performing Loans (NPL) rose by Tk11,816.71 crore to Tk1,25,257cr in the second quarter (Q2) of 2022 (April-June).
At the heart of such numbers lies, as per usual, our state-owned banks. At the beginning of 2019, the defaulted loans of six SOBs stood at Tk46,564cr. In 2021 it increased to Tk50,313cr. After June of this year, it further increased to Tk55,430 crore, which means that, in three and a half years, defaulted loans in six SOBs increased by about Tk9,000cr.
This is simply an astonishing achievement that no institution would want to associate itself with. And yet our SOBs, not having learned a thing from years of handing out bad loans, seem to wear it as a badge of honour.
This culture of corruption and subsequent bad loans must be taken with the gravity it deserves and be eliminated at the root. A functioning, healthy banking sector is all but imperative for the sustainable growth of the economy.
And with our banking sector’s default loan amount increasing at a near daily frequency, in the long run, this could be disastrous for Bangladesh and bring our growing economy to our knees.
We cannot allow that to happen.