Written by The Banking Post
Three private commercial banks plagued by irregularities and scams are set to face an asset quality review (AQR) this week, as Bangladesh Bank steps up scrutiny of troubled lenders.
AB Bank, IFIC Bank and National Bank will undergo the audit, which will be carried out by Deloitte Malaysia, officials confirmed after a review meeting at the central bank on Sunday chaired by Governor Dr. Ahsan H. Mansur.
Two Deloitte representatives have already arrived in Dhaka to launch the process, which is expected to begin within days. The audit will examine loan collaterals, property valuations, links between loans and bank directors, loan classification practices, large defaulters, and single-borrower exposures. It will also review liquidity indicators such as CRR, SLR, LCR and NSFR, as well as capital adequacy under the Basel-III framework.
“We expect the AQR of the three banks to be completed by the end of this calendar year,” a central bank official said. The exercise is being funded by the Asian Development Bank.
The move follows recent audits of six other banks. Ernst & Young reviewed EXIM Bank, Social Islami Bank and ICB Islamic Bank, while KPMG examined First Security Islami Bank, Global Islami Bank and Union Bank. Draft reports have already been submitted to the central bank, which is now considering merging five of the six lenders into a single entity.
Officials said the Bangladesh Bank also plans to extend similar audits to 11 more banks, with the World Bank likely to provide funding support.
