Karmasangsthan Bank, The

Karmasangsthan Bank, The was founded as a public sector specialised bank in 1998. The government launched the bank on 30 June with an approved capital of Tk 3000 million divided into 30 million shares of Tk 100 each under the Karmasangsthan Bank Act. Out of the paid capital of Tk 1185 million (2008), the government of Bangladesh paid 75% shares and the rest 25% was paid by public and private sector banks including Janata Bank, Agrani Bank, Sonali Bank, Uttara Bank, Rupali Bank, National Bank, IFIC Bank, BASIC Bank and Islami Bank Bangladesh and a few non-banking financial institutions and insurance companies. The prime adjective of the bank is to alleviate poverty from the country by providing credit facilities to unemployed youths, both male and female, to make them self-employed. The bank provides loan with a lower and simple interest rate on easy term. The bank has now (2011) 134 branches throughout the country with its head office in Dhaka. A total of 817 employees including 233 officers are extending the countrywide services of Karmasangsthan Bank.

The Bank implements its own micro-credit programme to make the unemployed youth self-reliant beside the government's special programmes including the Agro-based Industrial Credit Scheme and the collateral free microcredit programme for the retired and retrenched industrial workers and staff. The Bank disbursed a loan of Tk 6370 million to 146,999 unemployed males and females upto 2009. The Bank also realised Tk 4863 million against the dues of Tk 5388 million from them within that period. The cumulative rate of realisation was 90.3%.

The Bank disbursed as total collateral free microcredit of Tk 739 million to 13,556 retired and retrenched industrial workers and staff upto 2009. During this period, it realised Tk. 478 million against the dues of Tk 638 million from them. The cumulative rate of realisation was 74.9 percent. Under the Agro-based Industrial Credit Scheme, the Bank disbursed a total loan of Tk 483 million to 1831 entrepreneurs' upto 2009 and realised Tk 297 million against the dues of Tk 326 million from them within that period. The cumulative rate of realisation stood at 91.1 percent.

Basic facts and economic indicators (in million Taka)

Indicators

2004

2005

2006

2007

2008

2009

Authorised capital

3000

3000

3000

3000

3000

5000

Paid up capital

985

985

1085

1085

1185

2485

Reserved Fund

190

153

159

192

216

260

Deposits

a) Call Deposits

b) Term Deposits

Loans and Advance

262

1107

1506

1641

1914

2236

Investment

-

-

-

-

-

-

Total Asset

1396

1726

2141

2423

2744

4282

Total income

124

121

142

162

195

230

Total Expenditure

79

95

94

107

116

139

Foreign Currency Trading

a) Export

b) Import

c) Remittance

Total Manpower

86

620

690

678

703

817

a) Officers

145

188

219

219

233

b) Staff

475

502

459

484

584 -

Correspondent Banks

-

-

-

-

-

-

Total Branches (in numbers)

85

92

92

92

103

134

a) Domestic

-

92

92

92

103

134

b) Overseas

-

-

-

-

-

-

Agriculture Credit

a) Loan Disbursed

97

203

321

231

565

b) Realised

91

94

169

181

358

Industrial Credit

a) Loan Disbursed

39

125

92

107

149

b) Realsied

33

39

86

137

204

Loan Outstanding by Sector

a) Agriculture and Fisheries

338

369

466

598

643

b) Industry

159

174

230

444

498

c) Trade and Commerce

301

342

434

510

583

d) Poverty Reduction

-

16

335

175

333

Source Government of Bangladesh, Ministry of Finance, Banking and Financial Institution Division, Bank o Arthik Prothisthan Samuher Karjaboli (Annual Report on Banks and Financial Institutions), 2004-05 to 2009-10.

Presently, the Bank provides loan for setting up of the following projects: poultry farm, dairy, fish farm, beef fattening and goat-rearing, tailoring and sewing, handicrafts and cottage industries, handloom, pottery, hair-cutting saloon, and laundry, transportation (except two-stroke engines), wooden and steel furniture, boutique, computer, photo-copying, automobile and light engineering workshop, rural transport business (van, rickshaw, boat etc), stationary and departmental store, radio-TV and electrical goods repairing workshop, rural sanitary, pharmacy and nursery. Beside, any profitable, productive and service-oriented economic initiative is given due consideration by the Bank for granting loan.

Karmasangsthan Bank grants a maximum amount of Tk 1.00 million to an individual and Tk 4.00 million to a joint venture. The interest rate per year is ten percent for productive and service sectors and twelve percent for commercial sectors. [Muhammad Abdul Mazid]