Janata Bank Explained

Janata Bank PLC.
Type:State/Government owned
Key People:S. M. Mahfuzur Rahman[1] (Chairman) ‍and Md. Abdul Jabber (CEO & Managing Director)
Industry:Banking
Products:Banking services
Consumer Banking
Corporate Banking
Investment Banking
Revenue:US$272 million (2016)
Net Income:US$27 million (2016)
Assets:US$9.2 billion (2016)
Num Employees:12,391
Num Employees Year:2017
Foundation:Dhaka, Bangladesh
Location:Dhaka, Bangladesh

Janata Bank PLC. (Bengali: জনতা ব্যাংক পিএলসি) is a state-owned commercial bank of Bangladesh established in 1972. Its headquarters is situated at Motijheel in Dhaka, the capital city of Bangladesh. It is the second largest commercial bank in Bangladesh.[2] [3] [4] In 2019, Janata Bank had a fiscal deficit of 82.56 billion taka, the highest of any bank in Bangladesh ever.[5] [6] It's the best performing public bank in Bangladesh.[7]

History

Following the independence of Bangladesh from Pakistan at the Bangladesh Liberation War of 1971, Janata Bank PLC was formed combining the then United Bank Limited and Union Bank Limited under the Bank Nationalization Ordinance of 1972 (President's Order 26).[8]

In March 2004, managing director of the bank, Murshid Kuli Khan, visited Greece to study the feasibility of remittance from the country.[9]

The management of Janata Bank was changed under the Enterprise Growth and Bank Modernization Project' (EGBMP) which has been taken in 2004–05 in order to reform the nationalized commercial banks. Janata Bank became a public limited companies on 15 November 2007 led by chairman Sohel Ahmed Chowdhury.[10]

After Awami League came to power in 2008, they provided 145.05 billion taka in recapitalization funds to state banks including Janata Bank.[11] In January 2008, SM Aminur Rahman, was appointed managing director of Janata Bank.[12] Fahmida Khatun was appointed a director of the bank in August.[13]

In 2012, Janata Bank recalled their CEO of operations in the United Arab Emirates, Shafiqul Islam, following the embezzlement of US$1.3 million.[14] The Anti Corruption Commission questioned seven officials of the bank over the Hallmark-Sonali Bank Loan Scam.[15] Bismillah Group had embezzled 12 billion taka from Janata Bank and four others.[16]

In December 2017, Md Abdus Salam Azad was promoted to managing director of Janata Bank from deputy managing director.[17]

Janata Bank provided loans worth 55.04 billion taka loan to AnonTex Group, led by chairperson Md Younus Badal, from 2007 to 2015 which defaulted.[18] [19] The loans were more than 25 percent of the capital base of Janata Bank in violation of banking rules. The loans were provided from the Janata Bhaban corporate branch under manager Md Abdus Salam Azad, who would later become the managing director of the bank. The loans were approved by the board of directors led by chairperson Abul Barkat and managing director SM Aminur Rahman. Shaikh Md Wahid-Uz-Zaman, who was the chairman from December 2014 to 2017, blamed the board of directors and management of the bank for the loans to AnonTex Group. AnonTex Group restructured their loan with a 1-2 percent payment rather than the customary 10-15 percent payment needed for restructuring. Bangladesh Bank had provided Janata Bank permission ignore overexposure rules for providing loans to Galaxy Sweaters and Yarn Dyeing, a subsidiary of AnonTex Group.

Bangladesh Bank sought an explanation of the loans to AnonTex Group from managing director of the bank, Md Abdus Salam Azad. The group had laundered the money outside of Bangladesh using false invoicing of capital machinery. The loans were provided following an approval letter by Mizanur Rahman Akon, deputy general manager of Bangladesh Bank, without approval of Financial Integrity and Customer Services Department.[20] Janata Bank tried to delay the loans to AnonTex Group from being declared defaulted by Bangladesh Bank which allowed the group to borrow more money from the bank.[21] The Minister of Finance AMA Muhith spoke in favor of AnonTex Group after meeting it's chairperson.

The Bank had also loaned 12.3 billion taka to Thermax Group which also defaulted.[22] It was 27 percent of the capital base of Janata Bank. The Bank provided 34.43 billion taka loan to Crescent Group which also defaulted.[23] Crescent Group is owned by MA Kader and Abdul Aziz, two brothers, who also own Jaaz Multimedia. Anti-Corruption Commission had found Crescent Group embezzled money from Janata Bank while Customs Intelligence and Investigation Directorate reported that the group had laundered the money out of Bangladesh.[24] Bangladesh Bank stopped Janata Bank from re-hiring Syful Shamsul Alam & Co as its audit company because it had found the company aided Crescent Group in embezzling money from the bank.[25] Janata Bank was fined by Bangladesh Bank for providing undue favors to Beximco Group.

In 2016, Rajib Hasan, a senior officer of the bank embezzled 19.3 million taka from client accounts.[26]

In 2018, the government sought to appointed Hedayetullah Al Mamun as chairman of the bank but reverse course following backlash against the appointment.[27] The government instead appointed Luna Shamsuddoha, the first woman to head a state-owned bank in Bangladesh. Justices Zubayer Rahman Chowdhury and Md Iqbal Kabir of the High Court Division ordered Janata Bank to retake their recruitment test following the leak of the exam question papers.[28]

Janata Bank sought to reschedule loans to Root Group which had 10.49 billion taka in defaulted loans in August 2019.[29] Jamaluddin Ahmed was appointed chairman of Janata Bank in August 2019.[30] He is a former director of Bangladesh Bank and the general secretary of the Bangladesh Economic Association. He replaced Dr SM Mahfuzur Rahman. On 28 July 2020, Ahmed was replaced by SM Mahfuzur Rahman as chairman of the bank.[31] In 2020, a cashier of the bank in Noakhali District, Liton Chandra Das, stole 20 million taka from the bank.[32] Janata Bank made a loss of move than 50 billion taka in 2020.[33] Bangladesh Bank recommended actions against the managing director of the bank, Md. Abdus Salam Azad.[34] AnonTex Group sought to reschedule its outstanding loans.[35]

Janata Bank was having difficulty recovering money from non-banking financial institutions which were hit by scams by PK Halder.[36] The institutions were Bangladesh Industrial Finance Company Limited, First Finance Limited, FAS Finance and Investment Limited, International Leasing and Financial Services Limited, Peoples Leasing and Financial Services Limited, and Premier Leasing and Finance Limited.

Janata Bank sought to auction assets of Pacific Denims Limited to recover its loan in 2022.[37]

Board of directors

!Name!Designation!Reference
S. M. Mahfuzur RahmanChairman[38]
Ajit Kumar PaulDirector
K. M. Shamsul AlamDirector
Ziauddin AhmedDirector
Md. Abdul MajidDirector
Rubina AminDirector
Meshkat Ahmed ChowdhuryDirector
Muhammed Asad UllahDirector
Md. Abdul JabberCEO and Managing Director

External links

Notes and References

  1. Web site: Board of Directors . Janata Bank . 1 June 2020.
  2. Web site: Janata Bank . 2007-07-14.
  3. Web site: Janata Bank PLC.. . 2016-07-28.
  4. News: State banks still in capital deficit . The Daily Star . 2016-07-09 . 2016-07-28.
  5. News: Rahman . Sajjadur . Uddin . AKM Zamir . 2019-07-24 . Bad loans put Janata in trouble . 2022-10-21 . . en.
  6. News: Alo . Jebun Nesa . 2017-04-05 . Janata weighed down by restructured large loans . 2022-10-21 . . en.
  7. News: 2022-02-20 . Janata Bank hides Tk377cr loss through window dressing . 2022-10-21 . The Business Standard . en.
  8. Web site: Janata Bank History . 2022-10-21 . Janata Bank.
  9. News: The Daily Star Web Edition Vol. 4 Num 283 . 2022-10-21 . .
  10. News: 2007-11-16 . Sonali, Janata, Agrani banks become PLCs . 2022-10-21 . . . en.
  11. News: Ahmed . Inam . Liton . Shakhawat . 2018-02-18 . State Banks: Plundering made easy . 2022-10-21 . The Daily Star . en.
  12. News: Janata Bank gets CEO . 2022-10-21 . The Daily Star.
  13. News: 2008-08-26 . Janata Bank gets new director . 2022-10-21 . . en.
  14. News: Rahman . Sajjadur . 2012-08-27 . Janata Bank recalls UAE chief . 2022-10-21 . . en.
  15. News: 2012-11-20 . ACC grills 7 more Janata Bank officials . 2022-10-21 . The Daily Star. en.
  16. News: 2022-10-18 . How to restore public confidence in banking . 2022-10-21 . The Business Standard . en.
  17. News: 2017-12-07 . Azad new Janata Bank CEO . 2022-10-21 . . en.
  18. News: 2020-02-10 . BB seeks explanation from Janata MD . 2022-10-21 . . en.
  19. News: 2018-02-07 . Janata Bank Loan Scam: Whole bank was in it . 2022-10-21 . The Daily Star . en.
  20. News: Alo . Jebun Nesa . 2018-10-28 . AnonTex riding on BB favours . 2022-10-21 . . en.
  21. News: Alo . Jebun Nesa . 2018-09-09 . Ghosts within Janata Bank . 2022-10-21 . The Daily Star . en.
  22. News: 2018-10-22 . Question for regulators to answer . 2022-10-21 . The Daily Star . en.
  23. News: Alo . Jebun Nesa . 2018-10-01 . Janata now goes for auction . 2022-10-21 . . en.
  24. News: Khan . Mahbubur Rahman . Alo . Jebun Nesa . Parvez . Sohel . 2019-01-18 . Crescent curse on Janata . 2022-10-21 . . en.
  25. News: Uddin . AKM Zamir . 2018-08-10 . Cash Incentive Scam: BB blocks rehiring of Janata's audit firm . 2022-10-21 . . en.
  26. News: 2016-03-22 . Janata Bank to sue its officer for swindling clients’ FDR money . 2022-10-21 . . en.
  27. News: 2020-07-30 . Why was Jamal Uddin removed from Janata? . 2022-10-21 . Dhaka Tribune.
  28. News: 2018-08-16 . Retake Janata Bank recruitment test: HC . 2022-10-21 . . en.
  29. News: Uddin . AKM Zamir . 2019-08-22 . Defaulter Root Group to get fresh loans from Janata . 2022-10-21 . . en.
  30. News: 2019-08-21 . Sonali, Janata banks get new chairmen . 2022-10-21 . . en.
  31. News: Jamaluddin removed as Janata Bank chairman . 2022-10-21 . New Age . en.
  32. News: 2020-03-03 . Bank cashier held for Tk 2 crore embezzlement . 2022-10-21 . . en.
  33. News: Uddin . AKM Zamir . 2021-03-10 . Janata casts a pall on banking sector’s profit . 2022-10-21 . . en.
  34. News: 2020-01-23 . Janata MD in the line of fire . 2022-10-21 . . en.
  35. News: Uddin . AKM Zamir . 2020-12-28 . AnonTex seeks favour to reschedule loans . 2022-10-21 . . en.
  36. News: Uddin . AKM Zamir . 2021-01-27 . Commerce Bank, Janata run into a quagmire . 2022-10-21 . The Daily Star . en.
  37. News: 2022-10-18 . Janata Bank to put Pacific Denims on auction . 2022-10-21 . The Business Standard . en.
  38. Web site: Janata Bank Board of Directors . 2022-10-21 . Janata Bank.