Dhaka, Bangladesh (BBN) – The reconstituted Board of Directors of the BASIC Bank has asked its managing director (MD) and his team to formulate an action plan giving emphasis on recovery of non-performing loans (NPL) of the scam-hit bank.

The instruction was made at the first meeting of the reconstituted board held at the bank's headquarters in Dhaka on Monday with its Chairman Alauddin A Majid in the chair.

The board's latest move came as the NPL amount increased by more than 32 per cent to BDT 41.57 billion as of June 30 last from BDT 31.45 billion as of December 31 last year.

“We’ve reviewed the major indications of the bank at the first meeting,” Professor Mojib Uddin Ahmed, newly-appointed director of the BASIC Bank Limited, told BBN in Dhaka said after the meeting.

He also said the board has asked the MD and his team to formulate the action plan for improving the financial health of the state-owned bank.

"We're working to regain the glory of the state-owned specialised bank," Professor Ahmed said, adding that the board is committed to improve the financial health of the bank through establishing good governance and improving the quality of its services.

On Sunday, the central bank asked the top management of the BASIC Bank to implement 11-point action plan including establishment of good governance through ensuring accountability and transparency for improving financial health of the bank.

The Bangladesh Bank (BB) earlier found different types of irregularities in the BASIC Bank in giving loans. These include non-verification of customers' creditworthiness, absence of 'know your customer (KYC)' procedures, and extending loans to defaulters.

The central bank investigations detected financial irregularities involving around BDT 45 billion of loans in the bank's three branches located at Gulshan, Dilkusha and Shantinagar in Dhaka between 2009 and 2013.

BBN/SSR/AD-15July14-11:16 am (BST)