Muhith signals offloading shares of state banks

The government will offload its stakes in state-owned banks within its tenure to ensure participation of the private sector in nationalised commercial banks, Finance Minister AMA Muhith said yesterday.
However, the chairman of a state-owned bank opposed the minister's aspirations.
Muhith said there is hardly any private participation among the nationalised banks, except Rupali Bank that is listed on the stockmarket.
“Private participation will be increased, at least partly,” Muhith said at an annual conference of Janata Bank at Sonargaon Hotel in Dhaka.
The World Bank and the International Monetary Fund have long been calling for privatisation of the state-run banks.

In line with the suggestions by the lending agencies, three nationalised banks— Sonali, Janata and Agrani— were converted into public limited companies in 2007.
Opposing Muhith's announcement, Janata Bank Chairman Abul Barkat said the government's plan is nothing but a condition of the World Bank and the IMF.
Those agencies are political institutions, he said. “If shares of the nationalised banks are offloaded, the government will lose its control at one point, as the shareholders will seek ownership over the banks.”
The banks' financial stability may also be hampered due to the private sector's participation within the banks, he said.
The finance minister also said the government will soon announce separate pay scales for the employees of Bangladesh Bank and the four state-owned banks.
On November 14 last year, Prime Minister Sheikh Hasina approved a draft of separate pay scales for the bank employees, which the law ministry has already approved.
On the recent thefts in a state bank, Muhith said the banking sector's strength has increased, but it does not mean that such thefts and forgeries are not taking place, he said.
“The recent thefts at bank's vaults are concerning incidents. Tough steps will be taken to beef up vault security, but everyone will have to be more cautious.”
MA Mannan, state minister for finance, urged the bankers to adopt new financial technologies in services.
“If you increase the use of new technologies, it will reduce corruption at individual level.”