Six major state-owned banks—Sonali, Janata, Agrani, Rupali, BASIC, and Bangladesh Development Bank (BDBL)—have been operating without managing directors (MDs) for nearly a month, creating a leadership vacuum in these key financial institutions. The Ministry of Finance sent a letter on September 19, officially canceling the contracts of the MDs for these banks. In response, the chairmen of the banks have urged Finance Adviser Dr. Salehuddin Ahmed to expedite the appointment of new MDs. Banks hit by liquidity crunch: Limited cash withdrawals spark nationwide frustration In a meeting on Monday, Sonali Bank Chairman Mohammad Muslim Chowdhury, Agrani Bank Chairman Syed Abu Nasser Bakhtiar Ahmed, and Rupali Bank Chairman Nazrul Huda met with the finance adviser to discuss the urgent need for leadership in the banks. They stressed the importance of filling the vacant MD positions as soon as possible. A chairman who attended the meeting confirmed that they had formally requested new MD appointments, and the finance adviser assured them that the matter would be reviewed. Finance Adviser urges banks to ensure rigorous loan scrutiny and inclusive lending Since the September 19 letter, the MDs have been officially removed from office, leaving the banks to operate without their top executives.

Prime Minister Sheikh Hasina on Wednesday (November 01, 2023) said her government seeks to build a cashless society in a bid to reduce corruption, expedite development and ease revenue collection. “When we will be able to build the cashless society it will curtail corruption. The development of the country will be expedited and the revenue collection will be eased,” she said. The prime minister said this while inaugurating local currency card ‘Taka Pay’, first of its kind in the country, from her official residence Ganabhaban. She was connected virtually with headquaters of Sonali Bank, City Bank and Brac Bank. Sheikh Hasina said that as an independent and sovereign country, Bangladesh’s financial system has to be independent and sovereign for reducing dependency on others. PM Hasina launches Taka Pay, first-ever local currency card, to save costly dollars She put emphasis on data security of every holder of the newly introduced debit card. “I hope that the security system of this network will be well-protected. We have to pay special attention to this. Foolproof firewall has to be there,” she said. She said that this Taka Pay card will be a groundbreaking step for building the cashless society in Bangladesh. “We will not be dependent on others. We will use our money in our country, we will try to connect this system with otheir countries. We must not be dependent on any single hard currency,” she said. "Today I'm very happy," said the prime minister terming the own currency card as a landmark step for the country. She mentioned that the cards which are being used by the people are operated by the foreign companies. “No more foreign currency spending after introduction of Taka Pay card”," she said. Hasina spoke about her government’s plan to introduce international transactions through Taka Pay in future. She also underscored the importance of bringing everyone under banking services towards establishment of a cashless society. PM Hasina to launch 'Taka Pay' card Tuesday: BB The premier said every citizen of the country should be brought under the banking service. Directing the Bangladesh Bank to focus on establishing good governance in the banking sector, the PM said, the role of central bank is very important in establishing a cashless society. “So, special attention should be given to ensure that the service in the banking sector is more fair alongside good governance,” she added. PM Hasina asked the officials concerned to provide training and up to date information to the people so that they can use this Taka Pay card easily without any hassle in their daily payment. The card is be issued by state-owned Sonali Bank and privately-owned City Bank and BRAC Bank in collaboration with the central bank. 'Taka Pay' will provide the same service nationally through the use of 'The National Payment Switch of Bangladesh', an electronic payment platform operated by the BB. Election will be on time, BNP can’t stop it, says PM Hasina at press conference

Prime Minister Sheikh Hasina on Wednesday (November 01, 2023) launched local currency card Taka Pay to reduce dependency on international card schemes like Visa and Mastercard and save much-needed US dollars. Bangladesh Bank introduced the card, first of its kind in the country. PM Hasina inaugurated the card from her official residence Ganabhaban. She was connected virtually with the headquarters of state-owned Sonali Bank, private City Bank and Brac Bank. The three banks have been given responsibility to issue the Taka Pay card in collaboration with the central bank. 'Taka Pay' will provide the same service nationally through the use of 'The National Payment Switch of Bangladesh', an electronic payment platform operated by the BB. Initially, the card can be used within the country. Later the central bank will introduce Taka-Rupee card which can be used for shopping in neighbouring India. Electronic transfer of taka is done through Visa and MasterCard payment networks of business institutions including banks and other financial institutions. These entities offer branded payment processing services for credit, debit, and prepaid cards. Domestic card 'Taka Pay' will provide the same service, the BB sources said. It can be used abroad once foreign banks and institutions partner with the platform. It will reduce the cost of foreign exchange. Because foreign companies have to spend a lot of money on service charges. From the beginning, this card can be used at all ATMs, points of sales and online platforms in the country. PM Hasina to launch 'Taka Pay' card Tuesday: BB Initially it will be used as a debit card but in the future Taka Pay credit card will also come. Magnetic strip is used for security of this card. But now the new EMV technology with added security has been introduced in all bank cards. Gradually Taka Pay card will also be introduced with EMV technology. Paris-based consultancy Fime developed the card. Bangladesh’s neighboring countries also have their currency cards. India has card 'Rupee', Pakistan 'Pakpay', Sri Lanka 'Lonkapay'. Saudi Arabia has 'Mada'. Election will be on time, BNP can’t stop it, says PM Hasina at press conference At the outset, a video documentary on the Taka Pay was screened. Two freedom fighter customers of Sonali Bank withdrew money from City Bank's ATM using Taka Pay Card. Central bank governor Abdur Rauf Talukder was present among others at Ganabhaban. Prime Minister's Principal Secretary M Tofazzel Hossain Miah moderated the function, while BB Governor Abdur Rouf Talukder delivered welcome address. BB Executive Director Mezbaul Haque presented different aspects of the national card scheme “TakaPay”.Sonali Bank Managing Director Afzal Karim, Brac Bank Managing Director Selim RF Hossain and City Bank Managing Director Mashrur Arefin at their offices demonstrated the usage of TakaPay card, online payment and withdrawal of money from ATM where the users received the services. PM Hasina describes as successful her visit to Belgium for Global Gateway Forum

Some private sector banks in Bangladesh are in deep crisis because of lack of adequate liquidity and are being forced to borrow money from state-owned Sonali Bank at a 9 percent interest rate to stay afloat. Islami Bank, Al-Arafah Islami Bank and National Bank are borrowing money from Sonali Bank at a 9 percent interest rate, which is the highest commercial lending rate at present. Economists and banking sector insiders say that it means the sector is passing through a hard time due to higher non-performing loans, lack of good governance and serious corruption in the management of the respective banks. They say at present the call money rate is between 6-7 percent while banks are borrowing at 9 percent rate, which proves the crisis has mounted in these banks. They also say the troubled banks have no other options, but to borrow money. Also read: 5 held for spreading rumors on social media about Islami Bank, S Alam group Both such borrowing and lending are very risky considering the ability of investment of these banks, they say. BRAC Bank Chairman Dr Ahsan H Mansur told UNB that some banks have lost their customers’ trust due to their mismanagement. “As a result, people have withdrawn money from those banks,” he said. Giving an example he said that the deposit of BRAC Bank increased by 33 percent in the last quarter while the deposit volumes of many banks decreased. Also read: Scam-hit Islami Bank earns operational profit in 2022, Basic Bank reports loss Usually, banks charge a higher interest rate to lend to other banks while considering it risky, he said. On 13 December 2022, the Sonali Bank’s Board of Directors approved the investment of Tk200 crore in fund placement in favour of Islami Bank Bangladesh Limited and Tk75 crore in favour of Al-Arafah Islami Bank Limited at a 9 percent lending rate for a period of 90 days. On the same day, the bank's Board also agreed to the proposal to extend the term of the Tk150 crore loans to National Bank for another six months at 9 percent interest subject to payment of the previous interest. It is a normal practice that when a bank faces a liquidity crisis it borrows from another bank via the interbank money market. Read More: 60% bank sub-branches must be outside city corporations, municipal areas: Bangladesh Bank But the liquidity situation in three private sector banks is so critical that they are forced to borrow from another bank at the highest commercial lending rate. According to the Bangladesh Bank's guidelines, banks can charge a maximum of 9 percent interest on all types of loans other than consumer loans such as auto loans and personal loans, in which case the highest lending rate ceiling is 12 percent. Professor Dr Abul Barakat told UNB that any short-term borrowing at such a rate is not harmful, but it could create trouble while getting such loans will be lingering. He said banks sometimes face a liquidity crisis, then it is required to borrow to meet the instant crisis. But a 9 percent lending rate for banks is high. Read More: Bangladesh Bank expects first instalment of $4.5 b IMF loan to arrive by next month: Spokesman “Then how much a bank would have to charge against any commercial loans,” he asked. Sector insiders say corruption and lack of good governance are the main reasons behind such a crisis. Some questioned the role and the ability of the central bank of Bangladesh to regulate commercial banks that fail to check corruption.

Mobile financial services (MFS) provider Trust Axiata Pay (Tap) has launched inter-banking transaction services in collaboration with Sonali Bank. From now on Tap users can avail of the services using Sonali Bank's add money option. Read: Tap offers bonus data, cashback on Robi, Airtel internet packages Customers can avail of the services for free by adding the Sonali Bank option to their apps. To enjoy the service, add money or fund transfer option needs to be accessed. "Tap customers can add money or transfer funds of maximum Tk50,000 and Tk3 lakh monthly," the MFS CEO Nazmul Hasan said in a media statement.  

A Khulna court on Tuesday sent an industrialist to jail in a case filed over embezzling Tk 18 crore from the corporate branch of Sonali Bank in Khulna. The accused is Md Salauddin, managing director of Star Sea Food Limited. Khulna Metropolitan Session Special Judge Mahmuda Khatun passed the order after turning down his bail plea in the case, said Anti-Corruption Commission (ACC) lawyer Khandaker Mujibur Rahman. Lawyer Lutful Kabir Nowroz and lawyer Selim Howladar appeared for the state in the court. On August 16 last year, the ACC Deputy Director (Khulna) Md Shaon Miah filed the case against five individuals in the Khulna Chief Metropolitan Magistrate's Court. Read: Loan scam: 7 ex-Sonali Bank officials, 2 others get 17 years jail Md Salauddin, the bank's godown keeper Abdul Mannan Hawladar and grade-2 officer Abdur Rahman Babu were made accused in the case. On April 28 in 2018, the ACC's investigation showed that Md Salauddin embezzled the loan of Tk 18 crore 50 lakh borrowed from Sonali Bank. The collateral against this loan was the exportable shrimp kept in the company’s godown. The bank appointed Abdul Mannan Hawladar and supporting staff Abdur Rahman Babu for godown maintenance as long as the company does not pay back their loan. However, Managing Director (MD) of Star Sea Food Industries Limited Md Salauddin in collusion with Mannan sold all the exportable shrimps in the local market from July 15 to August 10 of 2017. The then deputy general manager of the bank Abu Hossain Sheikh found out about the secret fish sale and filed a case with the local police station at that time. Salahuddin was on bail, said lawyer Mujibur.

Bangladesh Bank (BB) Governor Fazle Kabir on Thursday urged the officials of state-owned Sonali Bank to deal with customers with full professional attitude. The governor was addressing as the special guest at Sonali Bank's 50th Anniversary and Golden Jubilee celebrations programme at Bangabandhu International Conference Center (BICC) in the capital on Thursday. He said the bank has contributed a lot to the economy which it should uphold in future. The journey of Sonali Bank started on March 24, 1972. Bangabandhu Sheikh Mujibur Rahman had given the names for Sonali and other state-owned banks after the independence. Finance Minister AHM Mustafa Kamal, as chief guest, said the cooperation of banks is needed to alleviate hunger and poverty from the country by 2030. Read: Merchant Bankers seek Tk 10,000 crore to sustain capital markets “The country will be developed with the cooperation of all. Without the banking sector the country will not be developed,” Kamal said. If the country does not develop, the banks will not be able to improve their financial condition, he said. With Sonali Bank Chairman Ziaul Hasan Siddiqui in the chair, Matiul Islam, the first finance secretary of Bangladesh and Abdur Rauf Talukder, the current finance secretary also spoke in the function. Md. Ataur Rahman Prodhan, CEO & Managing Director of Sonali Bank, delivered the welcome speech at the function. Dr Atiur Rahman, former BB governor, and Sheikh Mohammad Salim Ullah, secretary, Department of Financial Institutions, Ministry of Finance were present as special guests. Read: WB approves $120 mln loan to develop climate smart agriculture, water management The finance minister inaugurated the Golden Jubilee celebrations of Sonali Bank by cutting a cake. Highlighting various criticisms, the governor said that it takes time for Sonali Bank to process a loan. These need to be done perfectly. Recalling the Hall-Mark scandal, Fazle Kabir said, "After that, there was a bit of conservatism in lending." This mentality will not work, he said urging bankers to change their attitude and lend money in proper cases to get business going.  

Sonali Bank Limited, a state-owned bank, has written off Tk 2,728 crore of its top 20 defaulters, including Hall-Mark, due to non-recovery. Sources said the bank has set a target of recovering Tk 272 crore, or 10 per cent of the loan cancelled this year but the latest data says the bank could not achieve even 8 percent of the target even after eight months. When contacted, Managing Director of Sonali Bank Md Ataur Rahman Prodhan told UNB that the loans have been written off as per rules. Also read: SC cancels Hallmark chairman’s bail; asks her to surrender “We’re trying to recover the loans …our teams are working in this regard. Writing off does not mean the loans won’t be repaid. It’s just keeping the loans in a separate balance sheet,” Ataur Rahman Prodhan said. Bangladesh Bank (BB) introduced a loan writing-off system in 2002 and then rule was amended in April 2019. As per the amended rule, a bank can write off its loan which is treated as bad loan for three consecutive years. It was five years previously, says Sonali Bank. According to the central bank, Sonali Bank has written off the highest amount of default loans of Tk 6,995 crore among the public banks. Of the total defaulted loans of the state-owned bank, 38 percent are with 20 defaulters, the BB data shows. Hall-Mark is among the 20 defaulters which have got its Tk 1,229 crore written off out of Tk 3,000 crore. Sources at the Bangladesh Bank said Sonali Bank could not yet overcome the burden of the huge scam since not a single penny could be recovered. Hall-Mark's loan scam had shaken the banking sector, casting a long-lasting burden on Sonali Bank’s investment. Also read: Two govt panels to probe alleged special treatment to jailed Hallmark GM Not only Hall-Mark, but also 18 others of the top 20 defaulters of Sonali Bank failed to repay 'zero' amount as of August this year. The other defaulters that got their default loans written off from Sonali Bank are: New Rakhi Textile Mills Limited (Tk 123 crore), Jasmi's Vegetable Oil (Tk105.55 crore), Fair Expo (Tk 96.30 crore), Alpha Tobacco (Tk 96.3 crore), One Spinning Mills (Tk 93.90 crore), Imperial Dyeing and Hosiery (Tk 90.13 crore), Rokeya Textile Mills (Tk 82.65crore) ,Sahil Fashion (81.18 crore), Imam Traders (Tk 80.85 crore), Sumi's Sweater (Tk76.7 crore), Riverside Leather and Footwear (Tk73.76 crore), Unity Knit (Tk 71.13 crore), Siddique Traders (Tk 69. 26 crore), KPF Textiles (Tk 68.56 crore), Moon Knitwear (Tk 67. 64 crore), AR Khan Sizing and Fabrics (Tk 66.86 crore), Jadu Spinning Mills Limited (Tk 50.34 crore), Sahil knitwear (Tk 57.68 crore) and Mask Sweater's (Tk 48.86 crore).

The Anti-Corruption Commission in Khulna filed a case against five  individuals on Monday for embezzling Tk 18 crore 50 lakh from  the corporate branch of Sonali Bank in Khulna. Managing Director (MD) of Star Sea Food Industries Limited Md Salauddin and the bank's godown keeper A. Mannan was made the primary accused in the case. Read:27 booked for duping govt of Tk 10.40cr The case, filed by the ACC Deputy Director (Khulna) Md Shaon Miah, was registered in the Khulna Chief Metropolitan Magistrate's Court on Monday. According to the case statement,  Star Sea Food Industries Limited borrowed a total of Tk 18 crore 50 lakh from Sonali Bank. The collateral against this loan was the exportable shrimp kept in the company’s godown. The bank appointed  A.Mannan Hawladar and supporting staff Rahim Babu for godown maintenance as long as the company does not pay back their loan. However, Managing Director (MD) of Star Sea Food Industries Limited Md Salauddin in collusion with Mannan sold all the exportable shrimps  in the local market from July 15 to August 10 of 2017. Read: ACC interrogates alleged accomplices of PK Halder at FFIL The then deputy general manager of the bank  Abu Hossain Sheikh found out about the secret fish sale and filed a case with the local police station at that time. A. Mannan who is an activist of ruling party affiliated organisation ‘Sramik League’ and president of "Collective Bargaining Agent", (CDA,  a trade union of working men) allegedly influenced the law enforcement agencies using his connections with the higher-ups. Finally, the investigative officers of police assigned in the case submitted  a biased final report stating that no anomalies were  found and the allegation of Sonali Bank  DGM was false. According to sources, Mannan even went as far as harassing and threatening Abu Hossain in many ways for bringing the allegations. But the tide started turning when the Anti-Corruption Commission started investigating the incident. Read:ACC seeks wealth information of Mosharraf's private secretary After a thorough investigation, the ACC team found evidence or so they said of irregularities and finally filed a case on Tuesday accusing five people including Mannan and Salauddin. Confirming the matter, Sheikh Shahidul Islam, the current DGM of Sonali Bank Khulna Corporate Branch said that Mannan has already been suspended over the matter and others who were made accused would follow him once they get a final copy of the case.

Robbers looted around Tk9 lakh at "gunpoint" from Sonali Bank in Chuadanga's Jibonnagar upazila on Sunday.