DHAKA, Nov 21, 2017 (BSS) – BASIC Bank Limited is planning to cut its Non-Performing Loan (NPL) by 30 percent in the next three years as the rate of NPL is now 50 percent of the bank’s total outstanding loans.
“We are working to set a plan to cut at least 10 percent NPL each year. We will finalize the plan in December,” newly appointed BASIC Bank Managing Director Muhammad Awal Khan told BSS here today.
The total outstanding loan amount of the bank is around Taka 14,000 crore while the amount of NPL is over Taka 7,000 crore. If the bank can achieve the target of reducing the amount by 30 percent in the next three years, the NPL will come down to Taka 5,000 crore.
Terming the recovery of NPL as his main priority and challenge, Awal Khan said the bank is working to bring down the NPL to a tolerable level by taking necessary steps.
“We are getting cordial support and guidance from the government, Bangladesh Bank and board of directors (of BASIC) in this regard,” he added.
He said “We will begin implementation of the plan from January. If we can attain the target, it will be a huge achievement.”
Mentioning that the former managing director of the bank worked hard to recover the huge amount of NPL in his tenure, Awal Khan said the rate of recovery is now better than before as the officials of the bank are working to speed up the recovery process.
Awal Khan said BASIC Bank rescheduled Taka 4,000 crore loans earlier, so that the borrowers can back their money easily, but loans of around Taka 2000 crore have become classified again.
“After completing all process for the recovery of the loans, we will go to court for legal actions, if needed,” he added.
Holding the three branches — Gulshan, Shantinagar and Dilkusha — responsible for the huge amount of the NPL, he said a central monitoring team will be formed with the bank officials to create pressure on the borrowers and the bank will give its officials specific responsibility for intensifying the recovery process.
In the last three years, he said, the bank got re-capitalization fund of Taka 3,390 crore from the government for strengthening its capital foundation. “We will also seek Taka 1,000 crore more to the government in the 2017-18 fiscal year,” he added.
He said the bank made profits worth Taka 44 crore up to October this year although it suffered a loss of Taka 39 crore during the corresponding period of the last year.
“We hope that BASIC Bank will make operating profits worth Taka 55 crore this year,” he added.
Responding to a question, Awal Khan said the bank has a plan to reshuffle its officials from one branch to another from January on the basis of their performance to accelerate the NPL recovery process.