Massive bank loans for Moon Group
State-owned banks and privately owned banks alike have generously provided Moon Group with loans. Even Bangladesh hasn't lagged behind. On one hand the central bank has admonished Agrani Bank for providing risky loans, on the other it has rented out space at an exorbitant price in a building of Moon Group. Ironically, Bangladesh Bank itself has found gross irregularities in the construction of the building.
Moon Group has constructed a 30 storeyed building, Sunmoon Star, on government land in Dilkusha without approval of the concerned authorities. Its owner Mizanur Rahman is presently in police custody, detained in a different case.
Though it is a 30-storey structure, permission had been given for 23 storeys only. Five floors of the building, including two basements, have been built with city corporation funds. The city corporation took control of these last Tuesday.
Moon Group has constructed another 20-storey building near the Kalyanpur bus stand in Mirpur. The group doesn't own either plot of land wholly.
Even though two recent inspection reports of Bangladesh Bank stated that there were doubts whether the loans would be returned, Agrani Bank went ahead to provide Moon Group with a loan of Tk 2.38 billion. Privately owned National Bank provided the group with a loan of Tk 600 million. According to Bangladesh Bank, this Tk 2.98 billion of people's deposits has slid into the risk category.
Bangladesh Bank's report reveals that Agrani Bank was much eager to extend the loan to Moon Group. It says that it is important to recover the loan. Mizanur Rahman Khan, manager of the bank's main branch at the time and presently deputy managing director, was responsible for this. Other officers of the main branch couldn't avoid blame either. On 18 June this year, the central bank directed Agrani Bank to take action against these officers who were involved in the irregularities.
Notwithstanding, the finance ministry, the central bank and Agrani Bank have rewarded Mizanur Rahman Khan by promoting him as deputy managing director.
Mizanur Rahman Khan left for the US on 17 September on one month's leave. M Aslam Alam, secretary of the Bank and Financial Institution Department, says that this promotion was given upon the recommendation of Bangladesh Bank.
Khondkar Ibrahim Khaled, former deputy governor of Bangladesh Bank, tells Prothom Alo, "People like Mizanur Rahman have lobbyists even in the central bank. That is why they get loans in violation of the rules and even could influence Bangladesh Bank to rent offices in the building constructed with those loans."
Ibrahim Khaled recommends that a high-level inquiry committee be formed to look into the reasons behind why the loans to Moon Group were approved despite not having required documents, why the loan was released and also why Bangladesh Bank took offices on rent in the building.
The central bank's inspection report states that Mizanur Rahman chose Agrani Bank's main branch and the Barguna branch in his home district to take the loans. Agrani Bank approved loans totalling of Tk 3.81 billion in the name of MR Trading, a sister concern of the group constructing the Sunmoon building; Moon Bangladesh; Moon International; and, Moon Garments and Composite Textiles, though eventually loans of Tk 2.38 billion were released. Another Tk 330 million was provided as rent. Moon Group was given these loans within three years, while the client itself paid nothing.
Syed Abdul Hamid, CEO and Managing Director (MD) of Agrani Bank last Wednesday declined to comment regarding Moon Group. However, he admitted that it hadn't been possible to check all the minor details before taking a decision.
National Bank's MD AKM Shafiqur Rahman said that the matter took place before he joined the bank.
Innovative demand: Even after taking these massive loans, Moon Group has submitted an application to Agrani Bank stating that it would not be able to make any repayments before 2021. It said that after 2021 it would be able to repay the loan in three-monthly installments over a period of 12 years. They asked for time up till 2033. Agrani Bank granted time up till 2028, but Bangladesh Bank did not approve this. The central bank set a three-year time, but Agrani Bank has asked them to reconsider this.
Bangladesh Bank report says that Moon Group provided false information to avail loans for the construction of the building at Kalyanpur. The plot of land was of 52 decimals that is about 22,672 sq ft in area, but in the loan proposal the building's floor space was shown as 22,500 sq ft. Bangladesh Bank say that this is an unrealistic proposal. In order to extract the loan, the building's construction costs were shown as Tk 2.7 billion and the estimated selling price was projected as Tk 15,000 per sq ft.
An on-the-spot visit yesterday found the structure of a 20-storey building with a signboard reading 'Mizanur Rahman Medical College (proposed)'. Another 20-storey building of the same group, Razia Tower, stood beside this. This has 160 flats. The local people say that Mizanur Rahman has named the lane in front of the building Razia Road. This too is mortgaged to Agrani Bank.