The day Bangladesh Bank removed the managing director of Agrani Bank in connection with illegally sanctioning loans, the Anti-Corruption Commission swooped in and arrested three Agrani Bank high officials, including the one replacing the MD, for irregularities and corruption.
The state-owned bank has 935 branches countrywide.
On Wednesday, Bangladesh Bank removed Managing Director Syed Abdul Hamid for violating rules in granting loans amounting to Tk 792 crore. His removal came into effect yesterday, Zaid Bakht, chairman of Agrani Bank, told The Daily Star.
Late yesterday afternoon, the ACC arrested Agrani Bank Deputy Managing Director Mizanur Rahman Khan just hours after the finance ministry made him the acting managing director of the bank.
They also arrested Deputy General Manager of the bank's principal branch Akhtarul Alam and Assistant General Manager Shafiullah, spokesman for the ACC Pranab Kumar Bhattacharya told The Daily Star.
According to the ACC spokesman, they were arrested in the city's Motijheel area and would be in police custody until they were produced before a court today.
The four are accused of irregularities and corruption worth Tk 900 crore.
Of the Tk 900 crore, Hamid is blamed for Tk 792 crore loans disbursed from Agrani's main branch and the Asadganj and Laldighi East branches in Chittagong between 2011 and 2015.
In 2011, a Tk 120 crore loan was extended to Tanaka Tradecom International from the bank's main branch. The loan was approved by the bank's board with the condition that supplementary collateral must be kept as security with the bank.
Tanaka Tradecom later proposed changes to the condition, which Hamid approved without the consent of the board, sources said.
In 2015, he rescheduled loans of the company amounting to Tk 10.79 crore, which he did not have the authority to do.
In another instance, Hamid rescheduled a Tk 42.38 crore fund for Muhib Steel & Ship Recycling Industries that was already classified as a bad loan. Once again, he went beyond his authority.
The sources said Muhib Steel was given letters of credit (LC) facility time and again, which took its total outstanding amount to Tk 91.93 crore. The entire amount has now been classified as a bad loan.
Serious irregularities were allegedly committed by Hamid when disbursing loans to Mizanur Rahman Mizan, a customer of Agrani's main branch, and various companies linked to the client's Sun Moon Group.
The outstanding loans to the group now stand at Tk 300 crore and they have become risky, the sources said.
The BB had instructed Agrani Bank not to delegate any responsibility to its Deputy Managing Director Mizanur Rahman Khan due to reported irregularities and the bank's board directed the management to carry out the regulator's instruction.
Yet, Mizanur was given the charge of different divisions, including the loan recovery division, violating the BB directive and the board's decision, according to the central bank.
An official of the BB said the central bank inspections also found irregularities in loans given to other clients of Agrani, including Zaynab Trading of Chittagong.
“We received the removal letter [Hamid's] from Bangladesh Bank today [yesterday] and the order has already been implemented,” Zaid Bakht, chairman of Agrani Bank, told The Daily Star.
The removal came a day after BB Governor Fazle Kabir signed a proposal to this effect. As per the decision, Hamid cannot work in any bank for the next two years.
In February, the central bank served Hamid a show-cause notice on nine counts of irregularities as per the Banking Companies Act. His clarification was not satisfactory.
The BB later called him in for a hearing before its standing committee.
After a series of hearings, the committee on June 19 recommended his removal.
Hamid was appointed managing director and chief executive officer of Agrani Bank in 2010. He had been the deputy managing director of the bank since 2007. The government renewed his contract last year despite the BB's suggestion not to. Hamid is also a member of the Institute of Chartered Accountants of Bangladesh.
The ACC arrested Mizanur, Akhtarul, and Shafiullah in connection with their involvement in loan scams worth Tk 108 crore. The ACC had filed a case with the Motijheel Police Station accusing eight people, including the trio, of the loan scam.
According to the case document, the officials sanctioned a home loan worth about Tk 108 crore to the proprietor of Sun Moon Group Mizanur but the plot of land did not have any valid documents or Rajuk approval, the case document said.
Moreover, there was a case over the land pending with a court.