Ctg lawyers demand release of Tk 5cr FDRs from 5 banks, threaten legal action

The Chattogram District Bar Association has given five banks 10 working days to release more than Tk5 crore held in fixed deposit receipts (FDRs), warning that it will take legal action if the money, along with due profit, is not paid.

The association sent letters to the banks on 8 September, signed by its General Secretary Md Moinuddin, after repeated requests to encash matured deposits failed to yield payment.

According to the association, the delay has created a cash shortage that is making it difficult to meet obligations from its MB Fund, including payments related to members' deaths and post-retirement benefits.

The banks involved are First Security Islami Bank, Social Islami Bank, Union Bank, Global Islami Bank and Padma Bank.

The association said it was making final preparations to file cases if the banks fail to release the money within 10 working days of receiving the letters.

First Security holds largest share

First Security Islami Bank holds the largest amount, Tk2.80 crore, according to association documents.

Of that, Tk2 crore is kept in three FDRs at the bank's Kadamtali branch, while another Tk80 lakh is deposited at its Bahaddarhat branch.

The three Kadamtali FDRs are worth Tk1 crore, Tk50 lakh and Tk50 lakh. The association said it had applied several times for encashment but the money had not been released.

The bank later issued a Tk12,65,535.90 pay order for profit on the Tk1 crore deposit. The association said it presented the pay order to the bank twice, but it was not encashed.

For the Tk80 lakh FDR at the Bahaddarhat branch, the association said the bank cited a liquidity crisis as the reason for withholding payment.

Three other banks also owe funds

The association has Tk75 lakh in three FDRs with Social Islami Bank, with Tk25 lakh each deposited at its Keranihat, Muradpur and Gocha Chowmuhani branches.

Despite applications and discussions with the relevant authorities, the association said the bank had not released the funds.

Union Bank holds another Tk60 lakh in two Tk30 lakh FDRs at its Khatunganj and Agrabad branches. The association said it sought encashment after the deposits matured but was told the bank could not make the payment.

It also has Tk50 lakh in an FDR at Global Islami Bank's Khatunganj branch, which it said remains unpaid despite an application for encashment.

Partial payment received from Padma Bank

The association has received part of the money from a Tk50 lakh FDR at Padma Bank's Khatunganj branch.

According to the association, the bank issued 13 pay orders totalling Tk57,00,711, covering principal and profit. Of that amount, Tk33,00,711 has been encashed, while Tk24 lakh remains unpaid.

In their letters, the lawyers' association referred to the government's decision on returning funds to customers of Sammilito Islami Bank and said its FDRs should similarly be encashed through pay orders.

It warned that legal proceedings would be initiated against the banks and those concerned if payment was not made within the stipulated period.

Banks cite institutional payment restrictions

Speaking to The Business Standard, Global Islami Bank Khatunganj Branch Manager SK Rashel Uddin said the bank was currently making payments to certain categories of customers in line with its circular.

"Payments can be made from savings and current accounts held in individuals' names, but money in accounts held in the names of associations, companies or limited companies cannot be paid at present. Necessary approvals and procedures have to be followed to release such funds," he said.

Union Bank Khatunganj branch manager Md Shariful Islam said the branch had received the association's letter and forwarded it to the bank's treasury division.

"The branch cannot decide on its own to release the money. We have forwarded the association's letter to our treasury division, and we will inform the customer once we receive instructions from there," he said.

He also said that while payments were currently being made from individually owned savings and current accounts, approval was still awaited for payments from institutional accounts.

This correspondent visited Padma Bank's Khatunganj branch to seek a response but could not find branch manager Nurul Islam. Repeated attempts to reach him by phone went unanswered.