Bangladesh Three more banks got approval. As a result, the number of banks in the country stood at 62. The three banks are The Bengal Commercial Bank, People Islami Bank, and Citizen Bank.
In the central bank’s Emergency Board meeting the bank has given the initial approval letter of intent (LOI) yesterday. Bangladesh Bank executive director Abu Farhaha Mohammad Nasser told to the reporters after the meeting that the loan was given to three banks. Instead of 4 crores of rupees, they have to keep the capital worth Tk. 5 billion.
Three Banks Are – Bengal, People Islami and Citizens Bank – approved by Bangladesh Bank
The source said that the approval of the new bank was approved by the central bank yesterday’s meeting. Before the elections, the formation of a license for four new banks was started. In October last year, the loan of the 59th bank was given by The Community Bank of Bangladesh of the Police Welfare Trust. In November last year, the bank received final approval from the schedule. Vice Chairman of Bengal Group is the main entrepreneur of Bengal Commercial Bank Limited. Jasim Uddin is also under the Bengal Group, there are currently about 20 industry and service organizations in different sectors. Chairman of Bengal Group is Noor Ali-2 constituency Awami League MP Morshed Alam, who is the director of Mercantile Bank. Earlier he was also the chairman of the bank. Chairman of National Life Insurance and Private Television Channel RTV is in charge of Morshed Alam. He is also the director of United Hospital and People’s University. United Nations Expatriate Awami League leader MA Kashem has applied for People’s Bank Limited. The resident of Sandwip, Chittagong, is working as the Vice-President of United States Awami League. Citizen Bank’s application comes from law minister Anisul Haque’s family. Anisul Haque’s mother Jahanara Huq has been mentioned as the chairman of the bank. In addition to the community bank, the expatriate welfare bank has got a license of commercial activities as a scheduled bank last year.
In all, 15 banks have been approved since 2009. If three other banks get approval, the number will be 62. But there are more applications to get the bank’s license to the central bank. Despite the pressure from the Ministry of Finance last year, Bangladesh Bank suspended the proposal for licensing of new banks.
Economists and bankers have always opposed the new bank, saying the number of banks in Bangladesh is much higher. There is no need for new banks of the current situation in the country. If the demand is greater than the number of banks compared to the size of the economy, then the ill competition will be created which will break the entire banking sector. However, former finance minister Abul Maal Abdul Muhith always talked of increasing the number of banks. He said many people in the country are now spreading their services due to lack of banking services. Abul Maal Abdul Muhith remarked that the bank is being given financial consideration even if there is no economic need. Muhith had always been under pressure to issue bank licenses.
In a letter to the Bangladesh Bank governor on September 25, Muhith wrote, “Probably, Bangladesh Bank has recently decided to license a proposed bank. I request you to give all the proposed banks a license. In a recent meeting, the government officials agreed to license the proposed banks, where the Governor of Bangladesh Bank was also present. ”
In the last few years, the country’s bank sector is in discussions on some major cases of debt scandal. Some of the last approved banks are also facing irregularities and liquidity crisis. Firms were forced to change the name due to irregularities. The chairman of NRB Commercial Bank, including Farmers, pressurized the directors to resign and remove the MDs by the central bank.