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The Financial Express

Recapitalisation of govt. banks through taxpayers\' money

| Updated: October 25, 2017 03:56:46


Recapitalisation of govt. banks through taxpayers\' money

AMID widespread criticism, it has been reported in the media that the government has put aside Tk 20 billion from the budget to replenish recapitalisation for the state owned banks and a private commercial bank. The amount that was earmarked from the budget was the taxpayers' money and it remains to be seen how much is it justifiable to inject capital for the banks that are suffering from capital shortfall? This capital shortfall situation in state-owned financial institutions is due mainly to management inefficiency and lack of good governance. For consecutive years, the government has been injecting tax payers' money to replenish the capital shortfall in this way. This system should not be revived for an indefinite period of time. It is not logical that government will provide capital for the banks due to wrongdoings of the banks management?  Taka 20 billion was put aside for four banks, a private bank and a financial institution. Institutional corruption is only being encouraged through the government's repeated replenishment of capital shortfall amount in this way which is pervading through the banking sector. The reasons for such perennial loss must be looked into and if it is found that it is a matter of management failure, then management of the concerned Bank should be restructured. 
Mohammad Zonaed Emran
A banker
 [email protected]

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