What good is an admission?
While we appreciate the finance minister coming clean in parliament that Tk 65,602 crore is now the bad loan amount (which is nearly 11 percent of all loans disbursed over the last decade), what we really would like to know is what is being done to fix the weaknesses in the banking sector? The information has been there for ages. What has been done about it?
Committees have been formed and probe reports have pointed fingers at individuals serving either on the management of banks or their boards. Reports and recommendations have been furnished after every major scam that has rocked both state-owned banks and now, more recently, privately-owned institutions, like BASIC Bank and Farmers Bank.
And every time such a problem surfaces, we see the same foot-dragging by the central bank and we go through the motions of an investigation, a report and recommendations, which are seldom made public and hardly ever put into action.
We have been furnished with a significant list of companies that have defaulted on loans. We acknowledge that there are two categories of defaulters, ones who default due to economic compulsions out of their control. The other category consists of those that are habitual and perennial defaulters, who manage to get out of the list of defaulters by rescheduling their loans using their political links, or get reprieve by the court. What is the government doing about it? What message does the repeated rescheduling of loans to a selected few recurring defaulters, give to the people? Such policies breed more ill-discipline and push the banking sector into deeper morass.
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