Despite economic progress over time, Bangladesh's banking sector is facing crises due to loan default and money laundering by a section of unscrupulous people.
Several state-owned and private banks are now in crisis due to non-repayment of loans. As a result, genuine businessmen are not getting loans. Recipients of the loans are using fake deeds of lands, documents of mortgaged properties and identities of ghost persons, sources claimed.
The directors of various private banks are allegedly granting loans to one another to eat up banking sector and public money in syndicated way. As a result, the volume of the defaulted loans is stockpiling alongside denial of loan to the real businessmen and laundering of money through hundi.
The defaulted lending in the country has stood at Tk 1,34,396 crore, a big figure largely caused by sham loans. Around Tk 8,00,000 crore has been allegedly siphoned off by unscrupulous people since independence of the country.
On December 5 last year, Transparency International Bangladesh (TIB) expressed deep concern over sham loans and recommended enactment of a law to authenticate real recipients of the borrowers. The anti-graft organisation also urged the government authorities concerned to join the Common Reporting Standard to stop plundering of the country's banking sector.
Sources said the borrowers get lands registered in favour of other people using fake NIDs and submit such deeds to mortgage the lands with the banks in black and white. Even the persons shown as guarantors of the loans are fake and non-existent. The NIDs of the guarantors are fabricated. The companies projected in receiving loans are factious.
Law enforcers have found evidence of submitting documents of khas lands of the government in getting loans. Rapid Action Battalion (RAB) arrested two persons on April 15 last year for swindling bank money through fake documents. Even deeds of lands were submitted to the bank beyond knowledge of the landlords. The banks are in trouble sanctioning loans based on such documents.
Some bank officials are hand in glove. Directors of various private banks are allegedly taking loans from one another for mutual benefits.
According to central bank of Switzerland, Bangladeshi citizens deposited Tk 3,000 crore with Swiss banks in last one year. Published on June 16 last year, the report showed that money deposited with Swiss banks till 2021 was Tk 8,275 crore which was largest ever compared to Tk 5,347 till 2020.
Global Financial Integrity (GFI), Washington based thing tank, said Tk 4,25,000 crore was laundered by the Bangladeshi citizens from 2009 to 2028.
Meanwhile, TIB claimed nearly $1,000-1,500 crore is laundered from Bangladesh per annum. Bangladesh Economic Association (BEA) said Tk 8,00,000 crore has been siphoned off since independence of the country.
Bangladesh Bank data shows that the defaulted loan in the country stood at Tk 1,34,396 crore till September last year. The ill-fated loan increased by Tk 33,000 crore in nine months from January to September last year. The defaulted loan accounts for 9.36 percent of the totally disbursed lending Tk 14,18,266 crore.
Experts said the lion share of defaulted loan was laundered and used for buying houses and making fortune abroad. The money laundering has affected remittance earning of the country. It is high time the government took stern action to check sham loan, defaulted borrowing, hundi and money laundering, experts cautioned.
Economist Dr Jalal Uddin Ahmed spoke of the need for immediate action against loan defaulters and money launderers.
Rise in defaulted loan is resulting in fall in remittance in proper channel causing serious reserve crunch in the country, he opined.
Mesbahul Haque, executive director and spokesperson of Bangladesh bank, ruled out any scope for taking loan through fake documents.
Every bank verifies documents before sanctioning loan, he said adding that the power bank directors are specified by the Bangladesh Bank and they cannot go beyond the guidelines.
Besides, the law enforcing agencies are making drives and taking action against the people involved in hundi business, he added.
BDST: 1840 HRS, FEB 15, 2023
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