Sunday, July 22, 2018 | ePaper
Tk 1,500 crore stuck up in Farmers Bank
Ministry in dilemma to recover funds of State agencies
The Ministry of Finance is in a dilemma over how to recover funds of State agencies from the Farmers Bank since the trouble-hit bank has been continuously refusing to pay back their money, citing liquidity crisis.Â
A number of government agencies have already lodged complaints with the Finance Ministry and the central bank after failing to recuperate the funds that were deposited in the fixed deposit accounts at different branches of the Farmers Bank.
The bank earlier failed to pay back matured fixed deposits of the Bangladesh Climate Change Trust Fund (Tk 508 crore), Jibon Bima Corporation (Tk 115 crore), the Mongla Port Authority (Tk 68 crore), The Bangladesh Telecommunication Regulatory Commission (Tk 38.59 crore) and the Ansar-VDP Unnayan Bank (Tk10 crore).
In the latest development, the Chattogram Port Authority (CPA) on last week sought Finance Ministry's intervention to get back its Tk 180 crore fund from the Farmers Bank.
In a formal letter to the Ministry of Finance, the CPA sought its help in recovering the fund that it had deposited in 10 fixed deposit accounts at Khatunganj branch with the bank.
"Negotiation has already been launched with the bank to get back deposits of the government agencies. But a little progress has been made in this regard due to fund crisis," a senior Finance Ministry official told The New Nation yesterday, asking not to be named.
He said, the State agencies are aggressively raising the matter with the Finance Ministry. About Tk 1,500 crore funds of the government agencies got stuck in the bank.
Â "In fact, we're in a dilemma over recovering the deposits of the government agencies as the bank is continuously refusing to pay back the funds citing liquidity crisis," he said.
When asked, he said, "How could we force the bank when it has become insolvent?"
He, however, hinted that the issue might be taken up with the government high-ups for an early settlement."
Md Ehsan Khasru, Managing Director of Farmers Bank, could not be reached for comments.
According to Bangladesh Bank, the deposit in the Farmers Bank was Tk 4,449.57 crore as of December last year. Of the amount, Tk1,410 crore of deposits were of government agencies, including the State-owned banks, and Tk 2,989.37 crore from private sector.
The Farmers Bank secured its licence along with eight other banks in June 2013.
Just few years after its operation, the bank hit media headline as the central bank found big loan scams at various branches of the bank, which founded by Awami League lawmaker Dr Mohiuddin Khan Alamgir.
Mohiuddin was the founder chairman of the bank. He resigned from his post last year as per the directive of the central bank.
Â In a report in October last year, the government said the Farmers Bank has created 'systematic risk' for Bangladesh's entire financial sector by taking loans at the high interest rates from depositors and other banks while it does not have the capacity to repay.
"Customers and organizations are losing their confidence in Farmers Bank everyday as they are failing to get their deposits back," according to the report.