• Tuesday, Nov 30, 2021
  • Last Update : 03:33 am

Bangladesh Bank bars NBL from disbursing loans

  • Published at 10:46 pm May 5th, 2021
NBL
National Bank, the first private bank established by Bangladeshi entrepreneurs in the country, is owned by the Sikder family. Collected

The central bank also asked the lender that its total loan and advances' growth cannot exceed 10% per annum

The Bangladesh Bank has instructed National Bank Limited (NBL) not to disburse any fresh loans before bringing down its advance deposit ratio (ADR) to 87% and improving its financial condition to protect the interests of its depositors.

The central bank on May 3 sent a letter to the bank's managing director about the issue, as per the Section 45 of the Bank Company Act, 1991, said Bangladesh Bank Executive Director and Spokesperson Md Serajul Islam.

As per the central bank regulations, the ADR for conventional banks is 87% and for Islamic banks 92%.

This means, in example, that conventional banks will be able to lend up to Tk87 when its deposits are at Tk100. Islamic banks will be able to lend up to Tk92 from their deposits of Tk100.


Also Read - BB instructs National Bank acting MD to refrain from banking activities


But as of December 31 last year, NBL's ADR stood at 91.57%, higher than the requisite.

The central bank also asked the lender that its total loan and advances' growth cannot exceed 10% per annum.

Before the move, the central bank on April 5 asked the lender not to disburse any loans without BB’s prior approval, as the central bank received allegations that the bank had disbursed a good amount of funds without approval from its board.


Also Read - BB ponders National Bank MD appointment proposal


The next day, the BB instructed ASM Bulbul, the acting managing director of National Bank, to refrain from all kinds of activities of the bank as his tenure has expired.

BB asked the bank not to allow Bulbul to get involved in regular banking activities if he was not reappointed.

Finally, the bank board at its 445th meeting decided to appoint Shah Syed Abdul Bari as the bank's managing director.

52
Facebook 51
blogger sharing button blogger
buffer sharing button buffer
diaspora sharing button diaspora
digg sharing button digg
douban sharing button douban
email sharing button email
evernote sharing button evernote
flipboard sharing button flipboard
pocket sharing button getpocket
github sharing button github
gmail sharing button gmail
googlebookmarks sharing button googlebookmarks
hackernews sharing button hackernews
instapaper sharing button instapaper
line sharing button line
linkedin sharing button linkedin
livejournal sharing button livejournal
mailru sharing button mailru
medium sharing button medium
meneame sharing button meneame
messenger sharing button messenger
odnoklassniki sharing button odnoklassniki
pinterest sharing button pinterest
print sharing button print
qzone sharing button qzone
reddit sharing button reddit
refind sharing button refind
renren sharing button renren
skype sharing button skype
snapchat sharing button snapchat
surfingbird sharing button surfingbird
telegram sharing button telegram
tumblr sharing button tumblr
twitter sharing button twitter
vk sharing button vk
wechat sharing button wechat
weibo sharing button weibo
whatsapp sharing button whatsapp
wordpress sharing button wordpress
xing sharing button xing
yahoomail sharing button yahoomail