National Bank has highest defaulted loans in Chattogram

National Bank has the highest number of defaulted loans in Chattogram, to the tune of Tk3,359 crore, which is 10% of the total defaulted loans in the city.

In the eight years from 2013 to 2020, the total amount of defaulted loans in Chattogram is about Tk36,000 crore. About one-third of the total defaulted loans of the country are in the port city.

People concerned have said that commission exchange relating to the family of the owner of the bank, unhealthy competition in lending loans and inefficient management are the reasons for the highest defaulted loans.

In Chattogram, the bank's top defaulter is Nur Jahan Group with a Tk11 crore defaulted loan. 

Mizanur Rahman, the director of the group, said, "We had to pay a large commission to get the loan. Besides, we incurred a huge loss due to a decline in edible oil price in the domestic market after we imported oil from the international market. Oil prices dropped to $550 from $1,200 in 2013-14."

With 9% of the total defaulted loans, Rupali Bank Limited is in second place with a default of Tk3,164 crore, followed by Janata Bank with Tk2,359 crore in defaulted loans, which is 6% of the total defaulted loans in Chattogram.

With 5% of the total defaulted loans, Agrani Bank Limited and South East Bank Limited are in fourth and fifth positions, with Tk1,832 crore and Tk1,622 crore in defaulted loans, respectively.

Shah Syed Abdul Bari, managing director of National Bank, did not want to talk about the issue.

The Khatunganj branch of National Bank has 64% of defaulted loans, the highest in the city. In the last eight years, the amount of defaulted loans at this branch is Tk2,167 crore. 

The bank's Agrabad branch is the second in terms of defaulted loans, amounting to Tk766.88 crore, or 23% of the total default of National Bank in Chattogram.

Besides, the bank's Andarkilla branch and Jubilee Road branch have Tk140.66 crore and Tk134.37 crore defaulted loans, which is 4% of the total defaulted loans of National Bank in Chattogram.

At the Khatunganj branch, loans have been provided to traders in various sectors, including consumer goods and edible oil. Many traders in this sector have gone bankrupt after incurring huge losses caused by fluctuations in domestic and international consumer goods markets at different times. 

Many traders have transferred funds to other sectors, particularly land purchase. In this way, the Khatunganj branch has become the highest defaulter.

Nurjahan Group in Khatunganj, one of the leading importers of edible oil, has defaulted on a loan of Tk1,100 crore. Ehsan Steel, a Chattogram based rod manufacturer, is the second-highest defaulter of the Khatunganj branch. The total debt of the bank to the company is Tk483.54 crore.

"I could not repay the loan due to the downturn in the steel and real estate business. However, I am trying to repay the bank loan slowly by having it rescheduled," said Alam.

The former manager of National Bank's Khatunganj branch, Md Shahadat Hossain said, "The company invested in housing after taking out the loan for the steel industry. I tried to recover the loan by rescheduling it while I was in that branch."

Besides, Tk393.21 crore to Chittagong Syndicate, Tk125.42 crore to Sagir and Brothers, Tk135.80 crore to Ahad Trading and Jalal & Sons of Ahad Group, Tk118.68 crore to Monoara Trading, Tk27.14 crore to Mamota Dairy Food and Products, Tk21.97 crore to Sun Dairy and Agro Products have been in default.

At the Agrabad branch of the bank, SA Group has defaulted on Tk278 crore and Mostofa Group has done so on Tk204.6 crore.

Position of banks as per amount of defaulted loans in Chattogram

Hefazatur Rahman, chairman of Mostafa Group, said, "Our main business was in the consumer goods and shipbreaking sectors. Later, we expanded the business to other sectors, but from 1/11 to 2013, consumer goods traders had to incur huge losses. At the same time, due to reasons of a national as well as international nature, the country's emerging shipbreaking sector is also in a crisis. Unable to cope with the loss of thousands of crores of taka in both sectors, the interest rates of the banks continue to rise."

Zia Habib Ahsan, a lawyer representing cases in the Chattogram Finance and Credit Court, said the banks had once given loans to traders without proper verification. Entrepreneurs' qualifications and abilities were not taken into consideration in disbursing loans. The bank's top executives did not analyse the global market situation, internal demand-supply and price situation. Even if they did, they did not take that into account.