The New Nation - Internet Edition

Staff Reporter

Finance Adviser Dr Mirza Azizul Islam advised the government banks to go for 'out of court' settlement of cases against loan defaulters.

There might be many good borrowers as well in your defaulters list who have become loan defaulters because of some justified reasons, he said.

"They should be given a chance to negotiate the issue outside court in an honorable manner," said the Finance Adviser.

It will help increase bank's cash inflow as well as save legal expenditure and time to do other jobs, he said while addressing the inaugural session of Janata Bank Limited (JBL) Annual General Meeting-2008 at a local hotel in the city yesterday.

He also expressed his dissatisfaction over the banks overdue loans that increased gradually to 16 per cent of the total loans and advances.

"Employees of public banks need to change their approach towards their profession. Sometimes Government bank gives too much attention to the bad clients, which makes goods clients leave unattended. It has to be changed," he added.

Bangladesh Bank Governor Dr Salehuddin Ahmed and Finance Secretary Dr Mohammed Tareq also spoke at the session, which was chaired by the Chairman JBL Suhel Ahmed Chowdhury.

The Finance Adviser also said the government would gradually solve the lending problems of the bank with other government agencies as it had done for Bangladesh Petroleum Corporation (BPC) through the issuance of bonds.

He appreciated the bank's performance in respect to some indicators like deposit and remittance collection, but criticised its poor performance in recovering classified loans, and lower import financing despite 17 per cent growth in overall imports.

About shortage of human resources in the newly transformed nationalised commercial banks (NCBs) into limited companies, Dr Aziz suggested re-deployment of bank executives from a less busy section to another busy section.

He also suggested the bank to be more inclined to adopting modern technology and innovative products, and to improve client services to make the bank more service-oriented.

"The bank must implement its commitment properly to improve client services through a new 15-year work plan," he said, assuring the government support to implement the plan.

The Finance Adviser, however, pointed out a challenge to be faced by Sonali, Janata and Agrani banks after having their new identity - on one hand they have social responsibility and on the other, they will have to earn profit for the government. "I hope, the bank will be able to face the challenge," he said.

Bangladesh Bank Governor Dr Salehuddin criticised that the bank's performance in import financing particularly in industrial raw material and capital machinery declined last year while the extent of classified loans increased to about 16 per cent, gradually rising from 12.0-12.5 percent in 2006 and 10.0-10.5 per cent in 2005.

He advised the bank to improve efficiency of its human resources, adopt information technology widely, impose method of operation and introduce innovative products to bring qualitative change in client services.

Bank chairman Suhel Ahmed apprised the meeting of the 15-year work plan of the bank and sought cooperation of the government to implement the plan to take the bank much ahead of its present condition.