Rejoinder, our reply
The NRB Commercial Bank has sent a rejoinder to a report titled “Tk 44cr shares, lot of questions” published in The Daily Star on March 8, 2017.
The rejoinder was signed by Haider Akhlaque, vice president and head of public relations division of the bank. The following is its text related to our report.
“It is to be mentioned here that, all the news articles, including yours cited Bangladesh Bank Inspection Report, which was never communicated to NRBC Bank by the central bank. If the central bank finds any discrepancy/misconducts or any other irregularities upon conducting inspection on any bank, then it must be communicated to the concerned bank so that the bank can rectify them for necessary compliance. However, in this case, as Bangladesh Bank didn't send any such report to NRBC Bank, the authenticity of such published irregularities becomes questionable by default. For record purpose, we would like to state the true picture of what transpired as follows:
“The report said Shahidul Ahsan has drawn benefits from nearly Tk44 crore shares held by two sponsor directors in NRBC Bank violating the banking company law. This is not true. Like any other customers, Shahidul Ahsan is just another client of the bank. How come he had drawn benefits without investing in the bank? The allegation raised by the news articles involving him is preposterous and is not based on actual evidence.
“The report also mentioned that Shahidul Ahsan influenced the board of NRBC Bank. There is no scope for a client to influence the board of a bank as it runs independently. So it is irrelevant that he influenced the board to enjoy loan facilities. Rather, the board unanimously decided to sanction the loan in favour of his companies considering the feasibility and profitability of the project. The bank has sanctioned the loans and advances to Shahidul Ahsan in full for the project.
“The bank has sanctioned the loans and advances to the concerns of Shahidul Ahsan in full compliance with the guidelines and regulations laid down by Bangladesh Bank. Moreover, till date all sanctioned loans have been regular and are providing substantial returns to the bank. The concerned loan that the news report has made allegations against is an agricultural loan that was sanctioned to facilitate establishment of a technologically advanced modern factory. The loan has been fully covered with its land, factory building, all imported machineries and other material and immaterial assets as collateral. On this ground, the allegation of having insufficient collateral against the loan is untrue.”
“It is important to note here that AG Agro Industries and Begumganj Feed Mill are separate entities under different ownership. AG Agro is the concern of Shahidul Ahsan while Mahbubur Rahman is the chairman of Begumganj Feed Mill. Both are regular and performing customers of the bank. A team of Bangladesh Bank physically inspected the AG project and expressed its satisfaction. Moreover, the central bank has also given its approval for refinancing the same project as well. If all these facts are taken into consideration, then there is no room for any adverse observation regarding the financing of the AG project.”
“For the past few months, an appointed observer from Bangladesh Bank is attending all meetings of the bank and observing the proceedings.”
OUR REPLY
The Daily Star ran the news report on the basis of an inspection report of Bangladesh Bank.
The central bank appointed an observer to the NRBC Bank at the end of December last year following detection of irregularities in its inspections.
According to the Bank Company Act, Bangladesh Bank doesn't need to send its inspection reports to the banks concerned. It takes punitive measures step by step to protect the depositors' interests. It appoints observer to a bank as the first step in taking action.
At a press briefing on the monetary policy on January 29, reporters asked questions about the inspection report on the NRBC Bank, the holding of shadow shares by the Mercantile Bank chairman and other loan irregularities.
In response, Deputy Governor of Bangladesh Bank SK Sur Chowdhury said the central bank appoints observer when financial indicators of a bank get worse.
“We have already appointed an observer to the NRBC Bank because of questions raised about its corporate governance,” he said.
We stand by our report.
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