& çâÌæÚUæð´ ·¤è ¥ôÚU Îð¹Ùæ ÁæÚUè ÚU¹ð´ ¥ÍæüÌ ¥ÂÙð ÜÿØ ÂÚU ŠØæÙ ÚU¹ð´Ð ãæÚU Ù ×æÙð´, €UØô´ç·¤ ·¤æ× ·¤ÚUÙð âð ¥æÂ·¤ô ©gðàØ ·¤è Âýæç# ãôÌè ãñ ¥õÚU ÁèßÙ ·¤æ ¹æÜèÂÙ ÎêÚU ãôÌæ ãñÐ ÖÜð ãè ÁèßÙ ×ð´ ç·¤ÌÙè Öè ·¤çÆÙæ§ü €UØô´ Ù ¥æ°, çÁ™ææâæ ¥õÚU ©ˆâæã ÕÙæ° ÚU¹ð´Ð ŠØæÙ ÚU¹ð´, ÜÿØ ã×ðàææ ¥æÂ·Ô¤ Âæâ ãôÌð ãñ´ çÁ‹ãð´ ÂæÙð ·Ô¤ çÜ° ÂýØæâ ¥æÂ ·¤Öè Öè àæéM¤ ·¤ÚU â·¤Ìð ãñ´Ð

State banks' stressed assets: cause for concern

BB says in Financial Stability Report

Star Business Report
Rising stressed assets and a couple of big financial scams in state banks have been a cause for concern for the banking industry, Bangladesh Bank said in a report yesterday.
Stressed assets, which include gross non-performing assets and restructured advances, stood at 13.5 percent of total loans at the end of December 2013, compared with 13.7 percent a year ago.
About a third (Tk 20,360 crore) of stressed assets are held by five state banks out of the 56 banks in Bangladesh, according to the Financial
Stability Report 2013.
Nearly half (48.2 percent) of stressed assets in the sector are with 10 banks: six state banks, two local private banks and two foreign lenders.
"Stressed assets can have adverse effects on banks' balance sheets and profitability. Consequently, it is a major concern for the regulatory authority as well," the BB said in the report launched at its office.
Atiur Rahman, governor of Bangladesh Bank, unveiled the report along with his deputies and the chief executives of banks and non-bank financial institutions.
The BB report attributed the increase in stressed assets in some banks to a lack of efficiency and transparency in the credit approval process, credit administration, credit monitoring and recovery.
Poor selection of borrowers, politically motivated lending and negligence in risk management practices are some other reasons the central bank identified for the rise in stressed assets.
The threat of increasing stressed assets may push the banks to put more money in place to meet additional loanloss provision, according to the report.
It said most of the banks maintain only required provisions, which may not be enough in the long run to mitigate the threat of increasing stressed assets in different segments.
SK Sur Chowdhury, deputy governor of Bangladesh Bank, said three-fourths of total classified loans are bad loans.
"A further increase in bad loans will negatively affect the banking industry."
Quoting from the report, Chowdhury said financial scams at the state-owned banks in the last few years may affect stability further. Rahman warned the CEOs of banks and other financial institutions on poor governance.
"We will not tolerate any loose governance and misreporting," said Rahman.
"The BB is equipped with modern technology to detect the day-to-day works of banks andnon-banks."
Glenn Tasky, banking supervision adviser for the central bank, said lending too much to the same type of borrowers and against similar collateral is a risk to Bangladesh's banking sector.
Helal Ahmed Chowdhury, vice chairman of Association of Bankers Bangladesh and CEO of Pubali Bank, said a rising number of nonperforming loans is a big challenge.
The report, the fourth of its kind, identified stringent loan classification and provisioning, constraint on loan rescheduling, ample liquidity, and automation of payment and settlement system, financial inclusion and satisfactory reserve contributed to bring stability in the financial sector.