Editorial
Don't fiddle with state-owned banks
Have professionally competent boards of directors
Judging by recent experience some state-owned commercial banks (SOCB) conjured up the image of financial swindling dens. In the public mind, they are tainted with a brush of scandals -- thanks to Sonali Bank scam followed by allegations, even revelations, of dubious wheeling and dealing by politically appointed boards of directors of such banks.
The biggest casualties of fiddling with these banks have been the depositors' trust, the cornerstone of the banking institution as well as financial discipline, the pillar of macro-economic stability.
Why are we raking up a bad memory? The reason for this is that the tenure of the boards of state-owned commercial banks (SOCB) having expired in September, they are due for reconstitution. Already, a scramble has hit a high pitch through hectic lobbying with government high-ups to be appointed to the new boards.
Finance Minister A.M.A. Muhith has asked what is so wrong about some of the politicians who have made contributions to business, industries or education to be picked up as board members. He says it's a combination of other professionals as well as politicians who were appointed as board members. True, but experience with political appointees has not been any unmixed blessing.
We know too well how after coming to power in 2009, this government had appointed some former leaders of Jubo League and Chhatra League as board directors. With what results, we again know far too well to entertain even the remotest possibility of the government repeating the same. Some precedents are dreadful: directors taking commission from business firms and individuals for helping them get loans; control mechanism of SOCBs breaking down topped up by weak internal monitoring; inter-bank transactions left unadjusted; and default loan returning with vengeance.
If the lessons have been learnt by the government and the finance ministry --we hope these have been -- then they shouldn't be messing up with the banks anymore. The government, particularly into the election year, might be tempted to place some political favourites on the banks' boards. Our overarching suggestion would be a strict application of a criterion to select qualified persons with good reputation and right professional profile for the boards so that these can work with desired level of competence. Placing any push-over and riff-raff on the board just because he or she is politically acceptable would be down-right counterproductive.
For our part, we assure the government of our full support in helping to scrutinise antecedents of those who may be vying for directorship.
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