Finance Division has provided Tk1,500 crore to Sonali Bank and BASIC Bank to meet their capital shortages and keep them afloat, said a senior official.
“The balance sheets of the two state-owned commercial banks were so weak that it could no longer bear the impact of the banks' credit forgeries,” said Bank and Financial Institutions Division Secretary M Aslam Alam yesterday.
According to a proposal, of the recapitalisation fund, BASIC would get Tk790 crore and Sonali Tk710 crore.
Both the banks have a combined capital shortfall of Tk3,987.94 crore as of last September, due mainly to their inefficient and corrupt mode of loan sanction and disbursement that resulted in huge stockpile of default loans.
Finance Division officials said the banks concerned would now have to implement a set of conditions attached to the utilisation of the proposed recapitalisation fund.
As of September 2014, Sonali Bank's capital shortfall was Tk1,730.30 crore, up from Tk1,511.31 crore from June this year.
The shortfall of BASIC Bank increased by nearly Tk600 crore during the given period, suggesting a persistent deterioration in the financial portfolio of the bank, once considered as one of the best-performing public sector banks in the country.
The state-owned commercial banks including Sonali received Tk4,100 core as recapitalisation fund last December after they faced severe shortage of liquidity due to loan scams.
Sonali failed to realise a single penny during the last couple of years out of the swindled Tk3,500 crore by little-known Hall-Mark Group in 2012.
Sonali was recapitalised by Tk1,995 crore, Rupali Tk210 crore, Agrani Tk1,081 crore and Janata Tk814 crore last time.
Finance ministry officials concerned said the proposed fund could not be utilised by the banks on the head of their revenue expenditure, but for capital expenditure like automation purpose only.
They said the banks have to obtain prior permissions from Bangladesh Bank before they spend the recapitalisation fund.
A finance ministry official said both the banks have to revise their separate credit and credit risk management policies, prepare their individual policies for implementation (process manual) of the core risk management guidelines with detailed roadmap, form core risk management committees comprising directors of the respective banks and devising their own internal control and compliance policies.
“Our effort to recapitalise the public sector banks is expected to improve their scandalous image,” he said.
The current budget has an allocation of Tk5,000 crore in the head of bank re-capitalisation.
