BB imposes restrictions on disbursing loans for 6 S Alam-controlled banks

Bangladesh Bank (BB) has imposed restrictions on giving loans and prohibited opening Letter of Credits (LCs) for import in six banks under the control of the S Alam Group.

The banks will have to take permission from the central bank in case of distributing loans amounting over Tk 50 million.

The six banks will not also be able to renew loans they distributed to establishments violating the ceiling and whose terms have expired without realising the money from them.

The banks are - Islami Bank, Social Islami Bank, First Security Islami Bank, Union Bank, Global Islami Bank and Bangladesh Commerce Bank.

The banks were also instructed to submit their loan collections monthly to the central bank.

The Bangladesh Bank has taken the decisions at a time when the banks are almost empty due to plundering by the S Alam Group.

The central bank governor Abdur Rouf Talukder went into hiding after the fall of the Awami League government. The central bank lent the six banks Tk 350 billion by printing during his tenure. The Chattogram-based business conglomerate looted that money as well.

In this context, the central bank took the decisions after economist Ahsan H Mansur joined as the new governor on Wednesday.

The Bangladesh Bank, in its letter to the banks, said the decision has been taken as per the banking company acts to protect the interests of the depositors and stop slump in overall economic condition of the banks.

An official of the central bank said a plan has been taken to reconstruct the banks. This decision, a primary step towards that, has been taken to stop distribution of loans in names and to anonymous accounts.