Dhaka, Bangladesh (BBN)- The central bank of Bangladesh has expressed concern over irregularities committed by a section of directors as well as chief executive officers (CEO) of some private commercial banks (PCBs).
“It is a matter of concern and contrary to good governance,” the Bangladesh Bank (BB), the country’s central bank, said in a circular on Tuesday.
The central bank warning came against the backdrop of violation of the existing rules and regulations relating to bank management by some directors and CEOs of the PCBs.
“We’ve warned the directors and CEOs of the PCBs after identifying irregularities relating to responsibilities and accountabilities,” a BB senior official told BBN in the capital, Dhaka.
The BB official also said the central bank will take action against the directors and CEOs who have not complied with the existing rules and regulations properly.
On July 24, 2003 the central bank specified the areas of responsibilities and authorities of the board of directors, its chairman and CEOs to the PCBs in respect of its overall financial, operational and administrative policymaking and executive affairs, including overall business activities, internal control, human resources management and development.
The central bank, however, found that some directors and chairmen of the PCBs were taking part in daily affairs and interfering in the banks activities violating the existing rules and regulations.
Some of them also sit in the banks like regular officials besides attending board or committee meetings, according to the circular, issued on Tuesday.
Besides, some directors of the PCBs are using cars, telephones and office rooms of the banks, and engaging officials and employees in violation of the existing rules and regulations.
Under the existing rules, a chairman may be offered an office-room, a personal secretary or assistant, a telephone set, and a transport in the business-interest of the bank subject to the approval of the board.
The central bank has also identified that CEOs of some PCBs do not inform about violation of the existing bank company act and other rules and regulations to the central bank properly, the circular said.
The BB also said that some banks did not introduce policies relating to lending and risk management issues, human resources development, service rule and purchase and procurement.
Currently, 30 PCBs are operating their businesses across the country.
BBN/SS/SI/AD-13May09-12:32 am (BST)