• Wednesday, July 23, 2014

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BASIC Bank

Ex-chairman in thick of things

Ex-chairman in thick of things

Former BASIC Bank chairman Abdul Hye Bacchu illegally influenced all activities of the state-owned lender, leaving the once-sound bank in a rickety state, revealed a report of Bangladesh Bank. The central bank report, which also contains the findings of the observer deployed at the bank for stopping gross irregularities, outlined how the government-backed chairman abused his power to play an active role behind the loan scam. As to whether BASIC directors were unlawfully involved in any administrative activities, loan sanction, write-off, interest waiver and rescheduling, the observer stated that the...

BASIC Bank: Blatantly looted

BASIC Bank: Blatantly looted

The central bank has sent a report on the financial scam at BASIC Bank to the Anti-Corruption Commission, detailing how borrowers embezzled money from the state lender through fake companies and suspected accounts. Bangladesh Bank sent the report to the anti-graft body on Tuesday, after concluding a special inspection into the scam in the first week of this month. The central bank first inspected BASIC Bank's Gulshan, Shantinagar and Dilkusha branches in 2012 and found evidence of serious anomalies in approving loans. Dilkusha branch, for example, doled out Tk 683 crore in loans to 16 borrowers, all of whom took the money through illegal means. One borrower, Asif Iqbal, proprietor of Reliance Shipping...

BASIC Bank Anomalies

Board meeting minutes fake!

Some 106 agenda involving Tk 1,354 crore loan were included in the minutes, but were not at all discussed at the 327th board meeting of BASIC Bank in December last year. A total of 308 agenda were listed for the meeting, but the number shot up to 414 in the meeting minutes, as found by the Bangladesh Bank-appointed observer in the scam-hit public bank. His remarks on promoting two bankers to the post of deputy managing directors were grossly distorted in...

Editorial

BASIC Bank chairman resigning

Given the ruinous state a successful specialized state-run bank -- the BASIC Bank -- has been brought into, submission of resignation by its chairman Sheikh Abdul Hye Bacchu appears somewhat diversionary having regard to an outcry among knowledgeable circles for his dismissal and prosecution. There is no way one can trifle with the irregularities that sent the bank on a tailspin with a loss upwards of Tk.4,500 crore, as estimated by Bangladesh Bank This scandal has the familiar ring of...

Scam-Hit BASIC Bank

Board dissolved

Board dissolved

The government yesterday dissolved the infamous board of BASIC Bank over its role in financial irregularities that cost the state-run lender Tk 4,500 crore in the last four years. The seven-member board of BASIC (Bangladesh Small Industries and Commerce) Bank has been dismissed "on the basis of the investigation report of the central bank" on the scams in the bank, the Banking and Financial Institution Division of the finance ministry said in a circular. This is the second time the board of a state-run bank was fired for financial anomalies in a span of less than two years. In December 2012, the board of Sonali Bank was reconstituted following the Hall-Mark...

BASIC Bank board dissolved

BASIC Bank board dissolved

A day into the resignation of BASIC Bank chairman Sheikh Abdul Hye Bacchu, the finance ministry today dissolved board of directors of the bank and appointed Alauddin A Mojid as its chairman. Mojid is currently serving as the chairman of Krishi Bank. The ministry issued a gazette notification in this regard today, the ministry official confirmed to The Daily Star. Bacchu, the main accused behind BASIC Bank's current financial straits, handed his resignation letter to Finance Minister AMA Muhith Friday night The move comes just two months before the expiry of his second term as chairman of the troubled bank. One of the best-run banks until 2009, BASIC Bank has been mired in financial...

BASIC chairman quits after Tk 4.5k cr graft allegation

BASIC chairman quits after Tk 4.5k cr graft allegation

Shortly after chairman of BASIC Bank Sheikh Abdul Hye Bacchu resigned from his post following allegations of financial irregularities involving Tk 4,500 crore in the state-owned bank, the finance minister today said he would face action if found guilty. Talking to reporters at his Secretariat office this morning, Minister AMA Muhith disclosed that Bacchu went to his residence and tendered his resignation letter to him yesterday. However, the ground Bacchu cited for his resignation could not be known immediately. Bangladesh Bank investigations have detected massive financial irregularities involving around Tk 4,500 crore in its three branches 2009 and 2013. While talking to reporters at secretariat today, the finance minister said though Bacchu tendered...

Change boards of scam-hit banks: WB

Boards of the state banks, including that of graft-ridden BASIC Bank, should be held accountable as part of the efforts to improve governance at public sector lenders, the World Bank said yesterday. "Governance reforms may include a change at the board level because, after all, the accountability of the management of these banks lies in large part at the board level," World Bank Country Director Johannes Zutt said. He made the comments while replying to a question over the government's reluctance...

BASIC Bank's credit rating sees steep fall

A credit rater downgraded the troubled BASIC Bank's rating by nine notches this year from a year ago, sounding an alarm over the lender's growing vulnerability to collapse. In its latest report, Credit Rating Agency of Bangladesh (CRAB) attached CCC1 to BASIC Bank, taking it down from BBB1, which means the ailing bank needs a financial lifeline and carries a very high credit risk. In 2013, CRAB had downgraded BASIC Bank's ratings by five notches to BBB1 from AA2 in 2012. The...

It's shameful

A White Paper on various frauds in the banking sector, including BASIC Bank, would be published through parliament sometime in the middle of the next fiscal year, Finance Minister AMA Muhith said in parliament yesterday. “Scams in the financial sector are very shameful for us … for my ministry it is a matter of regret,” Muhith said before the supplementary budget for the fiscal year 2013-14 was passed in parliament yesterday. He said the White Paper would be presented in the...

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