Committed to PEOPLE'S RIGHT TO KNOW
Vol. 5 Num 1082 Sun. June 17, 2007  
   
Business


Newly corporatised banks don't need bureaucrats
Says BB governor


In the wake of government's move to vest some bureaucrats with responsibilities of the newly corporatised banks, central bank governor could not help expressing his worry saying that the officials who have no banking experience and are accustomed to traditional bureaucracy would be misfit for these banks.

"The people may have experiences of working at the Secretariat, but this is not enough to run large banks like Sonali, Janata and Agrani," Dr Salehuddin Ahmed, governor of Bangladesh Bank (BB), told a roundtable in Dhaka yesterday.

He said, "We have clear guideline for appointing directors. The people who are experienced and have outstanding knowledge in economics might be appointed to the posts."

The discussion on Corporatisation of Nationalised Commercial Banks was jointly organised by Dhaka Chamber of Commerce and Industry (DCCI) and Media Foundation for Trade and Development at the DCCI auditorum.

DCCI President Hossain Khaled chaired the discussion, while Securities and Exchange Commission (SEC) Chairman Faruq Ahmad Siddiqi attended it as special guest.

Sources in the banking circle said the government has already reconstituted the Board of Directors of the three banks through appointing government officials as Board members.

National Bank Managing Director Aminuzzaman, Professor Abu Ahmed of Economics Department at the University of Dhaka and Dhaka Stock Exchange (DSE) Chief Executive Officer Salahuddin Ahmed Khan also took part in the discussion.

In his keynote paper, Agrani Bank Managing Director and Chief Executive Officer Naser Bukhtear stressed a qualitative change in the banking practice.

Even after corporatisation, 100 percent government ownership would remain as an obstacle to charting the future direction of those, he said.

Pointing to the need for being properly ready to compete with other private commercial banks, the BB chief said on corporatisation, the state-owned banks now face with both opportunities and challenges.

These banks should hire skilled manpower, even after no alter in their cent percent government ownership, Dr Salehuddin added, citing an example that the central bank of Pakistan had chosen its deputy governor from Citi Bank NA.

The BB governor suggested that the state-owned banks should enter the capital market in future in order to raise their own capital.

He said by doing so, these banks could ensure more efficiency, transparency and accountability turning down their bad reputation of problems-ridden banks.

And the corporatisation would help reduce the banks' huge burden, the BB governor hoped.

The National Bank's managing director suggested reforms in the banking system and said the bank directors should not be allowed to be involved in other jobs.

Underling the need for a convertible bond, the DSE CEO said golden handshake must be transparent so that only inefficient officials quit the banks, while competitive and energetic people with proper incentive package should continue to discharge their duties.

Picture
Bangladesh Bank Governor Dr Salehuddin Ahmed addresses the roundtable on Corporatisation of Nationalised Commercial Banks, jointly ortganised by DCCI and Media Foundation for Trade and Development, in Dhaka yesterday. SEC Chairman Faruq Ahmad Siddiqi was present among others at the discussion. PHOTO:DCCI