Shawdesh desk:

Seven financially weak banks have so far received Tk 6,585 crore from 10 stronger banks under the Bangladesh Bank’s new liquidity support arrangement.

Bangladesh Bank officials said that the support was aimed at alleviating the liquidity constraints the country’s weaker banks were facing and restoring some stability to their operations.

They said that weak banks had so far taken financial assistance of approximately Tk 6,585 crore under guarantees from the Bangladesh Bank.

Among these, Islami Bank received Tk 2,095 crore, Social Islami Bank Tk 1,175 crore, First Security Islami Bank Tk 1,000 crore, National Bank Tk 920 crore, Exim Bank Tk 700 crore, Union Bank Tk 400 crore, and Global Islami Bank Tk 295 crore.

All the banks except Exim Bank were previously under the control of S Alam Group.

Sonali Bank contributed Tk 3,000 crore, City Bank Tk 1,295 crore, Pubali Bank Tk 500 crore, Shahjalal Islami Bank Tk 400 crore, Dutch-Bangla Bank Tk 400 crore, BRAC Bank Tk 300 crore, Dhaka Bank Tk 250 crore, Mutual Trust Bank Tk 220 crore, Eastern Bank Tk 200 crore, and Bengal Commercial Bank Tk 20 crore.

Besides, the central bank governor, Ahsan H Mansur, will held a meeting with the nine crisis-hit banks to discuss their future plan of recovery and stability of banks, BB officials said.

On November 11, the Bangladesh Bank held a meeting with representatives of 17 good performing banks and asked them to provide more liquidity support to weaker banks which are struggling in repaying depositors’ money.

These banks have been struggling with a severe liquidity shortage and were unable to repay depositors’ money, which has further worsened their financial situation, bankers said.

Massive loan irregularities and mismanagement in the banks during the recently deposed Awami League government sent the banks to the state, they said.

S Alam Group having close ties with the Awami League-led government allegedly withdrew about Tk 2 lakh crore in names and anonymously from the country’s banking sector.

On September 25, Bangladesh Bank governor Ahsan H Mansur held a meeting with the managing directors and representatives of 10 strong banks to discuss the provision of loans against the central bank’s guarantee to aid the weaker banks.

The meeting decided that the stronger banks would be able to claim the loan amounts back from the Bangladesh Bank within three days, if requested. The interest rates for these loans will be determined based on the prevailing market rates.