Greetings to all stakeholders, Assalamu Alaikum. On the occasion of the Centennial Birth Anniversary of the ‘Father of the Nation’ ‘Bangabandhu’ Sheikh Mujibur Rahman I would like to pay homage to our ‘Greatest National Leader’ for his dedication for the nation and contribution towards independence of our country. In celebration of the event I am very much pleased to greet all of our stakeholders with best wishes for progress and happiness. Like most of the countries in the world we started the year 2020 with the hope of prosperity. But when this message is published, the country is severely hit by very much contagious Novel Corona Virus, COVID-19 like many other countries of the world. In the face of containment of contagion of the virus almost all the businesses has to be either slowed down or closed for some time for a couple of months. Eventually, the economy has suffered a lot which has caused millions of people as well as the banking sector to suffer. However, we have to look forward and adapt to a new era of social belongingness and health consciousness. The year 2019 witnessed our earnestness in continuing our focus towards achieving the desired goals in the midst of recovery from the financial turmoil it finds in due to comparatively tougher business horizon. Employees of the Bank have tried heart and soul to execute the strategy we set for the year. Yet, we could not prove our worth in bringing the bank into the path of sustainable resurgence and profitability. This report depicts the financials and other allied issues demonstrating the challenges encountered and achievements made with evidences of full confidence that our stakeholders continued to repose in us.
Looking back... While setting targets for the reporting year, we anticipated about our struggle in achieving operating profit in the face of deteriorating asset quality due to rising NPL and increasing provision and capital requirement. In spite of that we expected more operational efficiency to enhance the overall income generation capacity of the Bank by bringing discipline in all operational areas. However, despite putting-in humongous efforts in quest of achieving the predetermined goals, booming crisis pertaining to liquidity and increased challenges of compensating for non-performing loans have bothered us from registering the desired outcomes in terms of profitability for the reporting year. In the hindsight, we have gained more courage to set the targets more astutely and become optimistic about achieving those targets.
Looking up for further improvements… Although the devastation of the past debacles could not be swept away completely, stakeholders might have sensed our perseverance in bringing the bank to the helm of the industry, where it was before the catastrophe struck. On behalf of the management of the Bank, I assure you that we would continue to render our best efforts like the by-gone years to fetch the desired results for all of us. I feel that we would be able to rejuvenate ourselves with all the good practices to pave on the right track of banking norms. In 2019, some of the valued business houses started banking with us to facilitate us in moving towards the right destination and boost our confidence while the well-wishers kept supporting us to rebuild the image of the bank. As our strategy was clear and well understood, our customers have appreciated the knowledge, expertise and commitment of our personnel. That’s why I feel a sense of great pride being the CEO of once, one of the best banks of the country.
Priorities being taken care of… In 2019, given the reality of the Bank’s plight, we adopted innovative techniques and strategies which could have guided us towards the goal of operating profit. Like the previous years, we prioritized on attaining more income by boosting recovery of non-performing loans (NPL), restricting liquidity crisis from soaring up, lending to sound customers, exploring new avenues of income, establishing governance of highest standard and optimizing the use of human resources to the benefit of the company. Besides, our endeavor for finding new areas of finance and entering some potential sectors continued with high priority. Our efforts could not be turned into profitable reality since we had to bring our lending rates to 9% even though the effective rate of total deposit could not be brought down to 6% due to immense competition and previous agreements. As such, our revenue streams were not flowing so well to let the bank thrive towards attainment of our predetermined goals. Our strategic priority remains the same for 2020 also. Besides, we would also take the opportunity of increasing revenue from other potential sectors. In 2019 also, we opted for improvement in managing our adroit human resources through providing necessary training and motivating them in true practice of organizational culture.
Our commitment to stakeholders... As experienced in the last few years, the whole banking sector went through several challenges in 2019 also. Moreover, by the end of the reporting year, the whole banking sector has taken a hit in terms of persistent liquidity crisis due to aggressive lending by the Banks. Lower interest rates on bank deposits as well as failure to encounter multiple frauds within the industry induced the customers to adopt more conservative measures to safeguard their deposits. Even then, it’s quite evident that we had somewhat successfully handled those challenges and adapted to the challenging environment to attain a new status of resilience. Business environments change continuously in the wake of new local and global challenges. We had to change more and so did we. We had to be innovative and so did we. The stakeholders might have noticed considerable improvements in 2019 in business activities as well as house-keeping activities of the Bank in regularization of non-performing loans, totaling around Taka 19.00 billion and improvement of Loan to Deposit ratio by increasing base deposit while keeping focus on delivering quality customer service. Competition from other players of the industry continues to be intense and BASIC Bank’s customer service oriented strategy continues to deliver. On top of that the Bank further optimized the expenditures and utilized the manpower more efficiently in order to line up the bank towards profitability. The Bank emphasized on further developments of products and services commensurate to customers’ needs as deemed a necessity in present competitive scenario of the financial market. At the end of the reporting year, 46 (Forty Six) branches have registered in the profit zone, with quite a few branches missing out by small margin. However we are putting all-out effort to bring the Loan-to-Deposit (LD) ratio, the important indicator of a bank’s liquidity, within the realm of normalcy.
Looking ahead... We would like to continue to see opportunities in adversity as well even if the outlook for the Bank in 2020 is not beyond frustration, evolved from the drawbacks of the outbreak of Corona pandemic. The year ahead would be difficult and so we would continue to identify possible problems in time which may occur in course of the business. We aim to rebuild ourselves on our strengths, guided by our time-tested values of dignity, boldness, unity and commitment, and a strong sense of accountability to our stakeholders. Now, looking ahead, we dare to see our future in operating profit zone within a few years although we will have to face ever increasing difficulties in recovering the non-performing assets of the bank. Even then we expect to see more improvement in quality of assets, reduction of provision and capital requirements. We hope that Government of Bangladesh (GOB) will extend more support by replenishing capital to comply ‘Capital Adequacy Ratio’ as necessitated in BASEL accord. We are grateful to GOB for supporting us by gradually replenishing Taka 3.39 billion crore so far as capital up to 2017 since 2014. Besides, our endeavors for achieving more improvement in operational efficiency in the coming days will continue to thrive for operating profit for the Bank.
Acknowledgements… I would like to take this opportunity to thank and express my gratitude to our only shareholder- the Government of Bangladesh, the regulator- Bangladesh Bank, Bangladesh Securities and Exchange Commission (BSEC) for their able leadership, benevolent guidance and tremendous support. The Board of Directors deserves special thanks for their constant advice and valuable guidance. Besides, I would look forward to our regulators, patrons, valued customers and well-wishers for sharing their thoughts with us so as to enable us to accommodate to the financial reality of the Bank and pave for a better tomorrow for the stakeholders of the Bank. And finally, I appreciate all of my colleagues, engaged in providing day to day services to our customers through crafting innovative ideas and initiatives. Let’s stand together with the hope of a bright prospect of the bank.
Last words… Finally, I would appeal to all stakeholders to come forward with all their good-wishes and sincere efforts to rebuild the bank and hoist it together to the lofty heights of excellence it once achieved. I want to conclude my message by offering you a new outlook of the bank in the words of a famous quote of a Secretary of State of an influential nation: "There are no secrets to success. It is the result of preparation, hard work, and learning from failure."