Nazrul Islam Majumdar is an undeclared mafia in the banking sector. He was the chairman of Bangladesh Association of Bankers (BAB) for a decade and a half. No one could speak on his words. Known as very close to Sheikh Hasina. He used to collect subscriptions from different banks in the name of Hasina. Every year, several hundreds of crores of rupees were deposited in the then Prime Minister’s relief fund. Nazrul Islam Majumder used to collect Tk 2-3 crore from small and new banks, Tk 4-6 crore from middle tier banks and Tk 10-20 crore from big banks.
Besides, he earned a huge amount of money from the inter-bank football tournament. Only the entry fee of each bank was Tk 25 lakh. Apart from this, there are other costs.
Chairman of several banks told Yugantar on the condition of anonymity that all the bank chairmen were hostages, no one could speak. What Nazrul Islam Majumder said, would happen. A bank chairman said, BAB is largely responsible for the current plight of the banking sector. He said that an organization like BAB was busy in sports.
As per Central Bank rules, partial or complete interest waiver can be granted in case of death of borrower, natural calamity, epidemic, pestilence, flood, distress or closure of projects. There is no rule to waive interest in income sector and regular loans. However, despite the fact that NASA Group’s factories are operational and no natural disaster has occurred, Janata Bank has waived interest by disrupting the income sector. This facility is given with the special approval of Bangladesh Bank. The bank, which waived off large amounts of interest in 2021 and 2022, is now going through various crises.
Jatiya Party’s then Member of Parliament Mujibul Haque Chunnu brought up the issue of interest waiver of large loans without following the rules. In a discussion in the National Parliament on June 10, he said, there are four ingredients for an individual or organization to waive interest. A few hundreds of crores of rupees have been waived off for none of these institutions.
The central bank’s 2022 circular says, in light of the circular issued in August 1991, banks can waive interest in whole or in part due to various reasons beyond their control such as: death of the borrower, natural calamities, epidemics, pestilence, river erosion, distress or closure of projects. However, recently it has been noticed that interest waiver facilities are often given by banks in favor of various customers without considering the special situation. This may lead to reluctance to repay the bank dues on time to get interest waiver benefits, which is contrary to the overall credit discipline in the banking sector.
According to the information received, the debt of two organizations of NASA group is 156 crores. Against this, the interest accumulated is 261 crores. Janata Bank has waived that interest. The group had to repay only Tk 156 crore as against Tk 417 crore in interest-principal debt. Nasa Taipei Spinners and Nasa Spinners owned by Bank Entrepreneurs Association BAB and Exim Bank Chairman Nazrul Islam Majumder were waived interest more than the fund management cost of the bank. The central bank had initially objected to giving that facility in 2021 without following the directives of the finance ministry and the bank’s own policies. Later again the opportunity of loan adjustment with interest waiver is given.
Nazrul Islam Mazumder applied to Janata Bank on October 25, 2020 for interest waiver facility. His application was approved in the 654th meeting of the bank’s board of directors held in March 2021. Bangladesh Bank sent a letter to the MD of Janata Bank on June 3, 2021 seeking an explanation for giving interest waiver facility without following the rules. In an observation of the Central Bank, it is said that as a result of the court’s instructions, the two loan accounts are regular. Conventionally, interest waiver facility is provided if the customer lacks financial capacity to recover the long defaulted or defaulted loan. In this case, large amount of interest waiver on unclassified loans is contrary to conventional banking norms. In the memorandum submitted to the board of directors of the bank for interest waiver, it is mentioned that ‘cost of recovery is not ensured in the proposal’, which is contrary to the interest waiver guidelines of the Ministry of Finance.