Five Islami banks asked to update BB daily on big loans
The central bank has instructed five Shariah-based private banks to send a daily log of lending of Tk10 crore and above.
The banks are - Islami Bank, Social Islami Bank (SIBL), First Security Islami Bank (FSIBL), Global Islami Bank and Union Bank.
Bangladesh Bank spokesperson Mazbaul Haque said the central bank regularly asks for information from the banks.
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He said the directives to five Islami banks which have been brought under monitoring following anomalies in loan disbursement is part of the bank's regular tasks.
Besides, the central bank has asked Social Islami Bank and Global Islami Bank not to disburse loans of Tk50 crore and above.
Social Islami Bank Managing Director Zafar Alam said, "We will proceed in accordance with the central bank instruction. Besides, we will now focus on giving small loans to SMEs. The default rate of these loans is very low and the recovery is also good."
There has been a crisis of trust among customers of these Shariah-based banks due to allegations of irregularities in lending. In this continuation, such strict instructions came from the central bank.
Due to a cash crunch, the five Islami banks borrowed Tk3995 crore from the Bangladesh Bank on 6 December. The next day, two banks took another loan of Tk1252 crore.
However, a day after that, the banks returned Tk590 crore.
Last Monday, the Bangladesh Bank appointed observers to Islami Bank Bangladesh Limited and First Security Islami Bank.
The central bank appoints its senior officials as observers when the financial condition of a bank deteriorates, usually due to loan scams. Later, when the situation improves, the observer is withdrawn.
The Bangladesh Bank is investigating the allegation that Islami Bank violated the rules and granted Tk7,246 crore loans to nine companies this year.
