Many investors are currently in limbo regarding savings certificates due to uncertainty surrounding the returns on their investments and the receipt of profits.
Clients of savings certificates, particularly, are facing increasing difficulties at banks owned by the S Alam Group. Additionally, several weaker private banks are reportedly treating their clients similarly.
Bangladesh Bank, the Finance Division and the Internal Resources Division (IRD) of the finance ministry, and the Department of National Savings have been exchanging letters over the matter for a month, but the government agencies are yet to find any solution. As a result, clients vent dissatisfactions at banks after failing to get the money.
Such issues arose over four types of savings schemes issued by the Department of National Savings, and those are; 5-Years Bangladesh Savings Certificate, 3-Monthly Profit Bearing Savings Certificate, Family Savings Certificate and Pensioner Savings Certificate.
Mohammad Helal Uddin is a joint secretary at the Finance Division of the finance ministry. He shared his bitter experiences with savings certificates with this correspondent at the secretariat on Tuesday.
He said he has accounts at a bank owned by S Alam Group and he had been receiving profits against his investment on savings certificates, and he used to allocate that money for monthly spending, but the bank is not giving him profits now.
Many people were seen coming to the Department of National Savings with applications for branch change. Prothom Alo spoke to an applicant, who is a former additional secretary.
The former government official told Prothom Alo on condition of anonymity,” I am not getting back my money. Bangladesh Bank along with the Department of National Savings should take responsibility for this issue.”
Many of the people, who do not receive profits despite the profits being deposited to banks automatically and whose savings scheme will be matured in the near future, are applying to the Department of National Savings to change bank accounts and branches.
The Department of National Savings received 270 applications in the past two months, and the figure is unusual than any other time of the year, while secretaries, additional secretaries and joint secretaries are also among the applicants.
Controversial conglomerate S Alam Group owned or controlled nine private banks. The central bank reshuffled the board of directors at these banks following the fall of the Sheikh Hasina government.
Those banks are still in a severe liquidity crisis due to taking away huge money from them in names or other names. Depositors cannot even withdraw money as much as they need. Bank officials cannot withdraw their salary except for top officials. Transactions were maintained at these banks by sanctioning special liquidity support during the past government.
The Department of National Savings sent a letter to the IRD on what should be done to withdraw the money from the savings certificates.
Regarding this, IRD secretary Md Abdur Rahman Khan told Prothom Alo, “The issue is yet to reach me and I will take necessary measures after looking into it.”
Recently, Bangladesh Bank also sent a letter to the Finance Division on this matter.
The change of client’s bank accounts attached to savings certificates is involved with the Integrated Budget and Accounting System (IBAS ++), which is operated by the Strengthening Public Financial Management Program to Enable Service Delivery (SPFMS).
Finance Division’s additional secretary Mohammad Saiful Islam was the national programme director of SPFMS and he was promoted and appointed as the energy secretary on Monday.
In a letter on 17 September addressed to Mohammad Saiful Islam, Bangladesh Bank asked him to take necessary steps to change the banks and branches of 115 clients. But he took no necessary steps. In the meantime, the applications increase to change banks and branches.
Mohammad Saiful Islam told Prothom Alo that SPFMS looks after the technical sides, but the Department of National Savings is supposed to take care of everything related to the clients. Besides, a provision allowing a change of bank accounts might create some complexities and fear might arise of embezzlement without the knowledge of clients.
S Alam Group also owned Global Islami Bank. Banker Mohammed Nurul Amin has been appointed as the chairman of the bank. He confirmed Prothom Alo about the connection between the bank’s liquidity crisis and the savings certificate clients’ not receiving the profits.
Department of National Savings director Mohammad Shariful Islam told Prothom Alo application increases to change bank branches. They received 32 applications on Tuesday. Measures are being taken to change the banks as per clients’ demand, and there is no legal barrier to it, he added.
*This report appeared in the print and online editions of Prothom Alo and has been rewritten in English by Hasanul Banna