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Seminar on SNP on the performance of SOCBS and SME financing of Banks held in BIBM


A daylong seminar was held at the Bangladesh Institute of Bank Management (BIBM) on 05 November, 2017 in its auditorium. Paper titled “Impact of Social Safety Net Programs on the Performance of SOCBs” and “Impact of some financing on Banks probability: an enquiry across banks in Bangladesh” were presented in the seminar Md. mohiuddin Siddique, Professor and Director (DSBM), BIBM and Md. Masudul Haque, Assistant Professor, BIBM. Other members of the team are Mohammed Sohail Mustafa, Associate Professor, BIBM;Dr.Md.Mahabbat Hossain, Assistant Professor, BIBM; Md.Abdul Halim, Lecturer,BIBM; Md. Sadrul, Joint Director, Bangladesh Bank; Subash Chandra Das, FCMA,FCA, Chief Financial Officer, Sonali Bank Limited. Khondkar Ibrahim Khaled, Chair Professor of BIBM chaired the seminar. S. K. Sur Chowdhury, Deputy governor of Bangladesh Bank was also present as a chief guest.  Dr.Prashanta kumar Banerjee,  Professor  & Director (RD&C) , BIBM delivered inaugural speech.
S. K. Sur Chowdhury said, we all know that social safety net program is a commitment of the government to the people of the country. Government is always aware of the importance of proper implementation of such programs. In order to execute social safety net programs, involvement of the financial sector is a must. It can be said without any doubt that banking sector in Bangladesh is in the leading position in doing so. But for assisting such programs State Owned Commercial Banks (SOCBs) in Bangladesh are playing the role of a facilitator as part of their wide-ranging activities. SOCBs have a comparative advantage over the other banks in this regard as they have bank branches all over the country in both urban and rural areas. I must say that SOCBs are doing appreciable jobs for implementing Social Safety Net Programs of Government which I believe will act proactively for achieving financial inclusion in rural and remote areas of the country he added.

He also added that, we also need to keep in mind that banking is a business. Performance of a commercial bank is crucial for its survival and future. In this perspective, we must tradeoff between banks’ involvement in and benefits from this program. Bangladesh Bank is always giving importance in contributing to inclusive growth of the economy. Financial inclusion has no alternative in achieving this goal. The Central Bank is giving its directives to banks in line with SDG and other economic targets for the wellbeing of the country.
According to BIBM report, default loans in the SME sector have increased by more than eight times in the last seven years. In 2016, Tk 22,494 crore out of the Tk 136,176 crore disbursed by banks became defaulted; the amount of such default loans was only Tk 2,644 crore  in 2010. The default loan in the small and medium enterprise sector reached Tk 11,061 crore in 2014 and Tk 18,342 crore in 2015.
It should be strictly monitored to check whether the disbursed loan is being used properly, said Moshiur Rahman Chowdhury, managing director of AB Bank.
Arif Khan, managing director of IDLC Finance, said his non-bank financial institution has lent over Tk 3,000 crore to the SMEs, of which only 2 percent is nonperforming.

 

Written by Manager

Monday 6th November 2017