AKM Zamir Uddin

In a rare move, the central bank has taken a raft of measures to put National Bank Ltd back on track in the wake of massive irregularities at the first-generation private lender.

The Bangladesh Bank said NBL, one of the oldest private banks in the country, would not be able to disburse fresh loans before bringing down the advance deposit ratio (ADR) to 87 per cent.

Conventional banks must maintain an 87 per cent ADR, meaning they can lend Tk 87 against every Tk 100 mobilised.

NBL has been maintaining more than 90 per cent ADR for a long time, breaching the rules, compelling the central bank to take such a decision, BB officials said.

The higher ADR indicates that the bank is lending aggressively, ignoring the interest of the depositors.

The central bank issued a letter to the lender on May 3, asking it to follow a number of instructions strictly.

“The instructions have been given to the bank to improve its financial health and preserve the interest of the depositors,” the letter said.