‘Rupali has insufficient capital to handle risks’

Rupali Bank, the only listed state-run lender, is lacking in its capital adequacy ratio, according to the bank's audit report for 2021.

The lender will be required to maintain a minimum capital to risk weighted assets ratio (CRAR) of 10 per cent of the total risk weighted assets (RWA) in line with Basel III, it said.

The CRAR is known as capital adequacy ratio, meaning the ratio of a bank's capital to its risk.

A bank's CRAR ensures that the bank can absorb a reasonable amount of loss and complies with statutory capital requirements.

However, Rupali Bank maintained a CRAR of Tk 2,366.56 crore against a required Tk 4,252.84 crore, meaning a shortfall of Tk 1,886.28 crore, that is 5.56 per cent instead of 10 per cent, the auditor said in its emphasis of matter paragraph.

The Dhaka Stock Exchange disclosed the auditor's emphasis of matter paragraph in its website today.