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BIBM study: 85% of bank loans in 2017 disbursed in Dhaka and Chittagong

  • Published at 10:08 pm May 8th, 2018
BIBM study: 85% of bank loans in 2017 disbursed in Dhaka and Chittagong
A total of 85.74% of the credits disbursed by banks in Bangladesh in 2017 was concentrated in only two divisions - Dhaka and Chittagong, according to a latest research finding of Bangladesh Institute of Bank Management (BIBM). 66.7% of all the loans were issued in Dhaka alone, and 19.04% were issued in Chittagong. According to the study, the two divisions had received a total of 85.67% of total bank loans in 2016. The findings were disclosed at a review workshop on “Credit Operations of Banks” organized by the BIBM at its auditorium on Tuesday. The keynote paper was presented by BIBM Director Prof Dr Prashanta Kumar Banerjee. According to the research paper, over the years, banks have become more interested in disbursing big loans. On average, banks in 2017 disbursed 57% of their total credit as big loans, while they disbursed 58% for big loans in 2016. In 2017, the state-owned banks disbursed 40% of their credit to big borrowers, while private commercial banks, specialized banks, and foreign commercial banks disbursed 40%, 65%, and 73% respectively. Former Dhaka University economics professor Barkat-e-Khuda said: “The credit of the banks are being channeled and centralized in two or three areas, while the rural people are not getting credit. That means inclusive banking has not been happening.” He requested policymakers to look into the matter seriously. Addressing the workshop as the chief guest, Bangladesh Bank Deputy Governor Abu Hena Mohd Razee Hassan said the Bangladesh Bank is always concerned about bank loans as there has been major concern over rising default loans. “The central bank has been working towards special monitoring regarding credit operation of the banks as well as reducing default loans.” BIBM Director Prof Dr Shah Md Ahsan Habib as the chair, BIBM Supernumerary Professor Yasin Ali, Sonali Bank Limited Managing Director Md Obayed Ullah Al Masud, former Managing Director of Pubali Bank Limited Helal Ahmed Chowdhury, First Security Islami Bank Limited Managing Director Syed Waseque Md Ali, and NRB Bank Limited Managing Director Md Mehmood Husain spoke among others at the event.