Pubali Bank:The first bank in Bangladesh to celebrate 50th anniversary
Celebrating the 50th anniversary of Pubali Bank Ltd is an ideal opportunity to recall the evolution of one of the most promising financial institutions in the country. Participating in Bangladesh's development and contributing to building the nation's economic and financial infrastructure, the bank cannot only look back with pride on its glorious past. It also continues to actively build on its past accomplishments and heritage by involving it in the country's development towards an even more promising future.
Some Bangalee entrepreneurs in 1959 set up the bank as Eastern Mercantile Bank Ltd to establish their rights to do business and get bank finances. It was renamed Pubali Bank after the Liberation War in 1971.
During the Pakistani regime, Bangalee businesses were not given credit by the then West Pakistani banks.
Of those courageous entrepreneurs, AK Khan, OR Nizam, MR Siddiqui, Khan Bahadur Mujibur Rahman, Mirza Mohammad Ali Ispahani, Habibur Rahman and Dr Naimur Rahman were the notable sponsors of the bank.
“Eastern Mercantile Bank paved the way for the Bangalee entrepreneurs to do business at that time,” said Monzurur Rahman, the longest-serving director of the bank.
As a young entrepreneur, Rahman became a director of the bank in 1967 and is on the bank board till date.
The bank played a courageous role during the Liberation War. It had stopped remitting money from East to West Pakistan at the call of Bangabandhu Sheikh Mujibur Rahman. During the war the Bangalees also deposited their money at the bank as a safe custody because the West Pakistanis ran all other banks.
The bank is going to celebrate 50 years in operations next month. No bank in Bangladesh has this rare milestone. Sonali, Janata, Agrani and Rupali banks were established in 1972 through amalgamation and nationalisation of the branches of different Pakistani banks located in the then East Pakistan. The first generation private banks, which are leading the industry, were established in 1983 and afterwards.
Now Pubali Bank has 371 branches countrywide and employs over 5,000 staff. No private bank can boast of such a wide network.
Pubali Bank's operating profit reached Tk 365 crore on December 31, 2008 from Tk 305 crore a year earlier, registering a 20 percent growth. Its total volume of loans and deposits also marked a significant rise last year. Its non-performing loan (NPL) came down to only 3.59 percent last year, which was over 14 percent in 2005.
The bank has dozens of deposit and loan products and provides remittance and other services, such as receiving different utility bills. It can remit money within 24 hours with its online services.
But the growth path was not so smooth. The bank faced a lot of upheavals -- from nationalisation to denationalisation and privatisation, and NPL to become a problem bank on the central bank's list.
After independence of Bangladesh, the bank was nationalised in 1972 in line with the government policy and renamed Pubali Bank from Eastern Mercantile Bank. Subsequently on the changed scenario the bank was corporatised in 1983 and became a private bank in 1985. The then government handed over all assets and liabilities of Pubali Bank to Pubali Bank Limited. Since then the bank has been rendering all sorts of commercial banking services as the largest bank in private sector through its branches across the country.
Just after one decade of privatisation, the bank got the problem bank status in May 1994 for its poor performances in different indicators. The Bangladesh Bank as the regulator appointed an observer in the bank to monitor its activities.
The bank took more than a decade to come out of the problem bank's list and the central bank finally withdrew its observer in November 2007.
About steady profits in the past several years, Helal Ahmed Chowdhury, managing director of the bank, thinks strong monitoring and loan recovery as well as the management's commitment have helped salvage the bank and bring it to profitability.
“It was a tough task to come out of the legacy of nationalisation. Staffs were given training to change their mindset to compete with the private banks,” said Chowdhury who has been serving the bank for 32 years.
He joined the bank in 1977 as a senior officer. After serving in various positions of the bank, Chowdhury succeeded veteran banker Ibrahim Khaled a couple of years ago as the managing director.
“I want to give credit to my predecessors who rendered their time and knowledge to improve the bank's position,” the managing director said.
He also attributed the steady growth of the bank's overall business to the board's non-interference policy and good governance.
“Now the bank is emerging as a giant with its countrywide network and faster services. Numerous deposit and lending products with a quicker service are on offer,” said Chowdhury.
Its deposit stood at Tk 7,306 crore in 2008 from Tk 5,802 crore a year earlier, marking a 26 percent rise.
The bank's credit also witnessed a 22.21 percent jump to Tk 6,178 crore last year from Tk 5,055 crore in 2007.
Import and export business also showed a significant growth. The bank dealt with Tk 5,949 crore and Tk 2,480 crore worth import and export orders respectively in 2008, while the figures were Tk 4,835 crore and Tk 1,991 crore a year ago.
The bank lends at 12.5 percent rate and there is no hidden cost, the managing director said.
He also disclosed this year's expansion plan, which includes opening of 15 new branches to take the number to 386.
Mentioning that the number of branches that have so far gone online is 10, Chowdhury said: “ We have plan to raise such branches to 100 by the year-end.”
The Daily Star
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