A survey has revealed that 31 banks suffered a total loss of TK 3,600 crore from their stock market investment last year, which is primarily attributed to poor decision-making by banks, misuses of bank funds and the downturn in the stock market.
The survey also said that among the affected banks, most of the state-owned banks suffered the most losses, in addition, some private banks have also admitted their losses. Although private banks are known for their banking operations and improved governance, they have still admitted their losses.
Meanwhile the survey reveals that foreign banks that refrained from trading in the stock market are reported to have suffered no losses. The size of the banks’ losses last year was very unexpected and shows that the banks’ holdings have declined in value as a result of not selling their shares, forcing them to be specifically marked.
The market experts believe that most of the bank’s losses are due to betting on large stocks, investing in shares of companies with poor track records, and investing in companies that have been performing poorly for years. Also, one of the reasons behind the banks’ losses is that other lenders that invested in long-term troubled banks like ICB Islamic Bank and People’s Leasing were unable to make proper gains in their stock markets and suffered huge losses.
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