Crisis-hit BASIC Bank is likely to merge with City Bank following the government鈥檚 decision on merger of four state-owned banks.
In a meeting with City Bank on Monday, the central bank asked the private commercial bank to prepare to acquire any weak bank of the country, BB officials said.
Bangladesh Bank governor Abdur Rauf Talukdar held the meeting with City Bank chairman Aziz Al Kaiser and managing director and chief executive officer Mashrur Arefin, they said.
The boards of both banks have already discussed the merger, and if finalised, the two banks will report separate financials for the next three years, they said.
BASIC Bank has been facing a severe financial crisis, struggling to meet its operating expenses.
While the average ratio of total non-performing loans in the country鈥檚 banking sector stands at 9 per cent, BASIC Bank exhibited a highly elevated total non-performing loan rate of 63.7 per cent as of December 2023.
The crisis stemmed from alleged scams involving Tk聽4,500 crore, orchestrated by its former chairman Sheikh Abdul Hye Bacchu between 2009 and 2013, which led to his resignation in 2014.
Despite recapitalisation of about Tk 3,000 crore over the years,
BASIC Bank鈥檚 financial condition has continued to worsen.
State-owned Bangladesh Development Bank is set to merge with Sonali Bank, while Rajshahi Krishi Unnayan Bank will be merged with Bangladesh Krishi Bank.
This decision was reached during a meeting between Bangladesh Bank governor Abdur Rouf Talukder and the managing directors of the respective banks at the BB headquarters on April 3.
On March 17, Exim Bank and Padma Bank announced to be merged.
