Rejoinder and our reply
Major (Retd) Abdul Mannan, former chairman of Bangladesh Industrial Finance Company (BIFC), a non-bank financial institution, issued a rejoinder against a report titled 'BIFC on the verge of collapse' published in The Daily Star on November 14.
Here is what Mannan said in the rejoinder:
BIFC's loan recovery from 42 borrowers during 2005-2015 was unsatisfactory, when the total loan sanctioned was Tk 394.29 crore. Loan recovery until 2015 was only Tk 81.79 crore. But the interest accrued was Tk 445.45 crore plus the penal interest at Tk 7.35 crore.
Upon receiving an audit report from the Bangladesh Bank, I, as the sponsor director and former chairman of BIFC board, assured Bangladesh Bank to help recover the loan of Tk 312.50 crore and the interest thereon.
In the meantime, most of the 42 borrower companies have applied to BIFC for waiving interest on Tk 507.66 crore with Tk 96.69 crore penal interest, which, as per the borrowers, was very high.
Some of the borrowers met with the BIFC board members and Bangladesh Bank officials to convince them to get the interest portion waived but no settlement on the interest element could be secured yet.
However, I have been continuously persuading the borrowers for the loan repayment, which could be possible only if the BIFC's current board considers waiving some portion of the high interest charged by BIFC.
But BIFC's problem is elsewhere. The current board represents only 5 percent public shareholders. They do not have the mandate to settle the BIFC's current issues.
BIFC's current board has been declared illegal by the High Court and an EGM is on the cards. Once the legal board is elected through the EGM, BIFC's current financial crisis can be solved.
Our reply
We made the report based on Bangladesh Bank's findings. The rejoinder did not address issues mentioned in the report and brought some issues that were not in the report.
Umme Kulsum Mannan, wife of Mannan and also a former chairman of BIFC, was contacted for the report. She said the dues are being paid off gradually.
So, we stand by our report.