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Abdul Jabbar, the present Managing Director (MD) of Janata Bank PLC, assumed charge in April 2023. Janata Bank, one of the state-owned commercial banks, is known as the second-largest commercial bank in Bangladesh. Before his current assignment, Abdul Jabbar served as the MD of the Bangladesh Agricultural Bank. In an exclusive interview with The Daily Messenger’s Staff Reporter Saifullah Aman, he discussed the current scenario of the bank and various contemporary issues. The following are excerpts from the interview:
TDM: What is your initiative to restore the reputation of the bank?
Abdul Jabbar: After joining here, I first initiated a 101-day programme, which served as my main base. All the achievements so far have been through this programme. There is an opportunity to involve everyone in the work, and it has been well-received at the field level. They did their best, and I thank them for that. In areas where the organisation has shrunk, everyone is working in that place. One of my instructions was to bring out the actual position. If it increases, it will increase, and if it decreases, it will decrease.
TDM: The banking sector is facing a deposit crisis. What is your (Janata Bank) status, and what initiatives have you taken to increase your deposits?
Abdul Jabbar: Currently, Janata Bank has about Tk 1 lakh 12 thousand crores in deposits. It is normal for deposits to increase or decrease. When I arrived, the deposit was Tk 1 lakh 1 thousand crores. After initiating the 101-day programme, the deposit increased significantly to Tk 1 lakh 16 thousand crores. When various developmental works are done, government funds are used, and I had government funds here as well. The government takes this fund for various reasons, makes payments, and uses it for other purposes; therefore, there are ups and downs at the end of the year or the financial year. It increases again. Now, it is increasing again at the beginning of this year.
TDM: Most of the defaulted loans are in Janata Bank. We want to know your role in the recovery of defaults.
Abdul Jabbar: Our defaulted loans were increasing. We wanted to disclose the data on defaulted loans. Earlier, publishing this was the job. We had nothing secret in reducing our defaults. It might have been reduced in some other way without defaulting. From that place, we said that no, we won't do that. The matter which is real has been revealed. If it is made defaulted, the clients say that if the loans are not regular, they can’t do business. I was very strong on the point that I was not willing to give a chance under any circumstances. I am not willing to give a chance to make the bank a tool. When this message goes to the clients, they will be enforced to pay. After delivering this strict message to the clients, they later found that there was no way out without paying. When the bank goes into action, they pay money under compulsion. We were able to convince them to come into the system. There’s no way to exit the system. The list of defaulters also includes many ‘big fish’ (influential individuals). They are also given the same treatment. We have collected money from many major clients.
TDM: How much was the target to reduce defaulted loans?
Abdul Jabbar: We have taken our plan in a different way. Some plans are for five years, others for ten years. We aim to bring defaulted loans to single digit within four years. If the government becomes stricter in default collection, it may take less time for us. The clients invested the money they borrowed from the bank; they did not smuggle it. They will repay the money after generating revenue. This process takes time. Currently, the defaulted loan rate is 16 percent, and we have a target of reducing it by 1-2 percent annually. Whether we can achieve a reduction to 14 percent by 2024 or not, we are committed to bringing it to single digit within four years. This year, we aim to recover the maximum amount of defaulted loans and break records. I am optimistic, as we achieved something unexpected earlier this year. We are actively working in different places, emphasising the importance of our efforts.
TDM: How are you dealing with the ongoing dollar crisis and liquidity crisis?
Abdul Jabbar: The ongoing dollar crisis is not only a national problem but a global one. Initially, we expected improvement after Covid, but the Russia-Ukraine war and disruptions in the supply chain have affected international trade, leading to a dollar crisis in our country and a decrease in remittance collection. Janata Bank handles more imports than other banks, including fertilizer and oil, and imports for other government organisations. Despite the crisis, we manage dollars effectively, organising campaigns to increase remittances from outside. Remittances have nearly doubled this year compared to last year. The liquidity crisis affects all 62 banks in the country, and we address it using various strategies. Although there is an inter-bank transaction system, there is no reason for panic.
TDM: You are the largest LC (Letter of Credit) opening bank. What is your future goal?
Abdul Jabbar: Incidents of deception through LCs occur, and we make every effort to verify transactions. We apply various theories and further verification from the top. Bangladesh Bank monitors LCs of a certain amount, minimizing the scope for cheating. We conduct LCs for import-export after verifying international prices. Despite occasional payment delays, the product ultimately arrives.
TDM: What are you currently doing in terms of loan distribution?
Abdul Jabbar: We are currently giving more importance to small loans, particularly in the SME sector, as big loans are challenging to recover. It takes 2-3 years for an industry to stabilize, be it in terms of employment, profit, GDP, or any other aspect. Therefore, we focus more on small loans to promote entrepreneurship and business development.
TDM: Have you faced any obstacles or pressure while performing your duties?
Abdul Jabbar: I do not feel any pressure, and no one has applied any pressure on me. I avoid taking unnecessary pressure as I work to understand the psychology of clients. I take actions that do not harm them, as their survival is crucial for the bank and, ultimately, the country's economy.
TDM: What kind of steps are being taken to restore the good governance of the bank?
Abdul Jabbar: We maintain zero tolerance for lapses in good governance within the bank. If anyone violates institutional discipline or rules, we take strict measures without any leniency. Recommendations from above do not influence our decisions, and we ensure accountability for maintaining discipline.
TDM: Thank you for your time with The Daily Messenger.
Abdul Jabbar: Thank you, and best wishes to The Daily Messenger.
Messenger/Disha
