On November 18, the finance minister surprised almost everyone (not for the first time) by saying that those who highlight the sorry state of the banking sector are all “uninformed”.
While some who were shocked by this pointed to the “fact” that between 2011 and 2018, the government had given handouts of around Tk 13,660 crore to banks—to save them from collapsing into their self-dug abyss of mismanagement and corruption—as “proof” contradicting his statement. Some brought up the “fact” that defaulted loans grew by about 176.5 percent between 2009 and 2016—and beyond since—according to Bangladesh Bank (BB) data, as being another irrefutable “evidence” that glaringly refutes his statement.
Yet, what surprised me the most was… that among those guilty of being “uninformed”… was eminent economist and former interim government adviser Wahiduddin Mahmud, who said, “It's very unfortunate that the country's banking sector is infested with scams and there is a relation of capital flights with the irregularities in the banking sector.” Who would ever think those two are related? Not me… and certainly not the finance minister… it seems.
Worse still, Mahmud “cited” the theory of path dependence to say that if the tools which were used to protect anomalies in the sector had become weak, irregularities would increase… *cough* as if they haven't already *cough*… Literally basing his “uninformed” comment on “historical evidence”, of all things. Can you believe it? I didn't think so.
What I also found hard to believe was that… another of these “uninformed” individuals—Aftab ul Islam—happened to work for the Bangladesh Bank as director, who said that the country's financial health was in a very bad state because large-scale bank loans were being scheduled and rescheduled due to intervention from the government. Islam, also the former president of the American Chamber of Commerce in Bangladesh, now “uninformed”, did not help himself when he added that the central bank had turned into an extension of the finance ministry, implementing all the decisions that came from the government. Wait, no, that's wrong, the finance ministry is run by the finance minister… so I guess that's a good thing he finished off by saying, right? Maybe he is just “partially” uninformed… Moving on…
Unlike him, an individual who is clearly fully “uninformed”, had said, “standing in the middle of parliament” (would you believe it?), that what happened in the banking sector was “dacoity” (robbery), and that no action could be taken against those responsible for such dacoity because they were being backed by his own party members. This individual, is none other than the finance minister himself… Wait, what? Why did he say something so “uninformed”? Oh, I know… its only because dacoity is not a bad thing anymore that he said it. In fact, it's most likely an honourable profession… no doubt. Quickly moving on…
…An individual who must surely be uninformed, former adviser to the interim government, Mirza Azizul Islam, said that the banking sector was in total disarray because of massive irregularities, lack of good governance and political meddling. Can someone please explain to me how massive irregularities, lack of good governance and political meddling could be responsible for the banking sector being in total disarray, when the banking sector isn't in total disarray at all, as the finance minister suggested in his November 18 statement? Hmm? Clearly, he (who? *wink*) must be totally “uninformed”.
In all seriousness though. What should truly concern us, as a society, is that this problem of being “uninformed” is quickly spreading like a contagion. Infecting even a former central bank governor like Salehuddin Ahmed, who said that the country's banking sector was now facing multifarious problems like growing non-performing loans, political intervention and hostile takeover.
What I can't understand is… what's his problem with non-performing loans growing? I mean, he never complains about GDP growth. Or the growth/expansion of the universe. So why is he complaining about non-performing loans growing? Uninformed, or suspicious? You decide!
What is not up for debate, however, is the fact that comments like the “new bank licences” were granted “on political grounds”—suggesting corruption or nepotism is at play here—by the finance minister made on November 1, is completely “uninformed” in light of the finance minister's comment on November 18. But just ignore the “fact” that “both the comments” were made by the finance minister for a second.
After all, it's only three out of the four new banks that have ruling party members somehow tied to them. The other is only being set up by the “non-governmental organisation”… yeah right… Bangladesh Police Welfare Trust. Which means… it could also be not-for-profit… like nearly all the other state-owned banks at this point.
Lastly, in a country seemingly plagued by “uninformed people” (and certainly not irregularities and corruption in the banking sector), another of these uninformed individuals, Bangladesh Institute of Bank Management director Taufiq Ahmed Chowdhury, said (citing figures not from an uninformed individual, but from an entire uninformed institution, the central bank of our country) that the loan scams in the state-owned banks and recapitalisation fund provided to them from the public exchequer was like a vicious cycle never seen before in Bangladesh.
For your information Mr Chowdhury, even if that's the case, it “has” been seen in other countries in the past, like the finance minister said. And, in some countries, since at least a year before here (although for not as long). So it's not like what you're saying is not something we don't know already.
What we don't know, is how long that cycle can continue—as the finance minister also pointed out, when he said, “I don't know how many times loans can be rescheduled, but it seems like an unending process”—before the system collapses completely. But at this rate, we will soon find out. And when we do, we will be certain to let you know… so that you can finally stop being so, “uninformed”!
Eresh Omar Jamal is a member of the editorial team at The Daily Star. His Twitter handle is: @EreshOmarJamal