Darpan Chakma was the manager of the Rangamati branch of Probashi Kallyan Bank (PKB). He served as the manager of that branch for five years following 2020. During this period, he embezzled approximately BDT 15.7 million from the bank through various fraudulent activities, including creating fictitious loans in customers’ names and misappropriating loan instalments deposited by clients, and has since gone into hiding. The fraud was uncovered during an internal investigation by the specialised bank itself.

It is not just Darpan Chakma; many other branch managers and senior officials at the head office of the bank, which was built with the money of expatriates, have been involved in irregularities and corruption at various times. While it failed to play a role in changing the fortunes of expatriates, the pockets of many of the bank’s officials have grown heavy. The financial wounds of the bank are deepening as loans given in the past in exchange for political lobbying and bribes remain unrecovered. Data from July 2 shows that nearly 61 percent of Probashi Kallyan Bank’s loans have been classified as defaulted. The default loan rate in most of the bank’s 122 branches is now over 70 percent.

Various related sources and Bangladesh Bank’s observations indicate that policymakers at Probashi Kallyan Bank were involved in various irregularities and corruption from the very beginning of its formal journey in 2011. Most of those recruited as officials at that time were activists and leaders of the then-ruling party, Awami League and Chhatra League, which are now banned. The bank’s founding Managing Director, CM Koyes Sami, made these appointments without following any rules or regulations. The key influencer in this regard was HT Imam, the political advisor to the ousted Prime Minister Sheikh Hasina. Even a decade and a half after its establishment, the bank has been unable to emerge from the shadow of these influences.

Political influence has also dominated the introduction of the bank’s various products. For instance, the bank launched four types of deposit schemes for expatriate workers and their families. These projects were named ‘Bangabandhu Savings Scheme’, ‘Bangabandhu Education Savings Scheme’, and ‘Bangabandhu Double Benefit Savings Scheme’. Such an expression of political attitude in the naming of bank products has not been seen in any other bank in the country.

At the time of its inception, Professor Dr Tasneem Siddiqui, founder of the Refugee and Migratory Movements Research Unit (RMMRU), was a member of the Board of Directors of Probashi Kallyan Bank. But within just six months of the bank’s operations, witnessing corruption, nepotism and recruitment trade, she resigned from her position as a director.

When asked about this, he told Bonik Barta, “I was on the board of Probashi Kallyan Bank for six months. To make the bank a success through the contribution of both public and private sectors, I had prepared three excellent guidelines. In the meetings, I observed that despite preparing these guidelines, it was repeatedly stated that they had not been approved. Yet, even without policy approval, many people were recruited entirely unfairly and through nepotism without any scrutiny. At that time, there was hardly anyone in the Ministry of Expatriates’ Welfare who didn’t have their own people employed at this bank. The then-Prime Minister’s highly influential adviser, HT Imam, abused his power the most in these recruitments. He gave jobs to a large number of his own people in this bank. When I saw that there was no way the bank could actually stand on its feet this way, I resigned after six months.”

Stating that the bank could not develop from the beginning because the responsibility of the board was in the hands of individuals without experience in running a bank, he further said, “The bank’s initial laws stated that bankers with special experience could be appointed as chairman or to important positions. But within a short time, that rule was changed, and the secretary of the ministry began to become the chairman ex officio. Does a ministry secretary have any experience in running a bank? The potential of the bank was destroyed right at the start.”

Probashi Kallyan Bank officially began its journey on April 20, 2011. The ousted Prime Minister, Sheikh Hasina, inaugurated the bank. The then-government had launched this specialised bank purely based on political considerations. Although at that time, economists and many others had said that instead of creating a specialised bank, it would have been more beneficial to set up separate desks for expatriates in other government banks. 95 percent of the capital for the bank came from the Wage Earners’ Welfare Board. The government provided the remaining 5 percent. Although it started operations with a paid-up capital of only BDT 1 billion, this capital has now been increased to BDT 13 billion.

Every worker going abroad is required to pay a mandatory welfare fee. This fee is deposited directly into the Wage Earners’ Welfare Board fund. The capital for Probashi Kallyan Bank was provided from these funds deposited by expatriates. The objective of establishing the bank was to provide low-interest and rapid migration loans to aspiring migrant workers, to facilitate the integration of returning migrants into the national economy through rehabilitation loans, and to bring and distribute expatriates’ hard-earned remittances cost-effectively. But a decade and a half later, the bank’s founding objectives have collapsed.

As of July 2, the outstanding balance of loans distributed by the bank stood at BDT 32.23 billion, according to Probashi Kallyan Bank’s data. This loan was distributed among a total of 177,572 customers. Of this amount, BDT 19.62 billion was classified as defaulted. The default loan rate stands at 60.87 percent. Due to the failure to recover the distributed loans, this specialised bank has also incurred losses. The bank incurred a net loss of BDT 980 billion in the 2024-25 fiscal year.

During the tenure of the ousted Awami League government, many loans had to be distributed under the lobbying and pressure of their influential leaders, according to many officials of the bank. Those loans are no longer being recovered. There is also no trace of the loans that were issued in exchange for bribes. Beyond these factors, many expatriates who went abroad after taking loans returned without finding work. Some did not find work abroad in time. For these reasons, the loans given to expatriates are not being recovered.

The current managing director of Probashi Kallyan Bank, Wahida Begum, said, “There were some policy exemptions for Probashi Kallyan Bank regarding the calculation of the tenure for defaulted loans. As we’re a scheduled bank, the tenure of the central bank’s policy exemption ended on June 30. For this reason, the default loan rate has increased so much in July. The information regarding the 61 percent loan default rate will be reflected in the next September quarter. During this time, we’ll apply to the central bank to extend the tenure of the policy exemption. As of June 30, our default loan rate was 12.96 percent.”

Wahida Begum joined as the managing director of the specialised bank on February 2 of this year. Regarding the bank’s operations, she said, “I don’t know what happened in the past. The government appointed me as the MD of this bank. Since taking charge, I’ve been working to stabilise the bank. In the FY 2025-26, we made an operating profit of BDT 1.40 billion. The bank has incurred a loss only after accounting for the necessary provisioning.”

Currently, the bank’s Gobindaganj branch in Gaibandha tops the list for loan default rates. Opened in July 2023, this branch currently has a total of 2,396 customers. 78.82 percent of the loans distributed by this branch are classified as defaulted. Out of the BDT 521.6 billion in loans distributed by the branch, BDT 410 billion is now defaulted.

The branch manager, Ariful Haque, told Bonik Barta, “When the Awami League (now a banned organisation) was in power, local MP Abul Kalam Azad would call and pressure us to give loans to various individuals. We had to grant loans based on his recommendations. There are also some internal bank policies to blame for the high rate of loan defaults.”

He also mentioned that the bank’s operations are being hindered by a shortage of manpower. He said, “I’ve been running this branch with only two people. In many cases, the negligence of family members is greater than that of the expatriates themselves. The expatriates might be sending money correctly from abroad, but the family members living in the country aren’t paying the instalments. We’re often harassed while trying to collect loans in the field. Many customers can’t be found at home; some have become transient and moved to Dhaka to work in garment factories, making them untraceable. The rate of people returning from abroad empty-handed has also increased alarmingly. In the last month alone, 10 such customers have come to us who were forced to return immediately after going abroad.”

Some branch managers also disclosed information regarding the issuance of loans in exchange for bribes. Speaking on condition of anonymity, managers from two of the bank’s branches told Bonik Barta, “The previous managers issued several loans in exchange for bribes. In some cases, a bribe of BDT 50,000 was taken for a loan of BDT 200,000. Several brokers are also active across the country surrounding Probashi Kallyan Bank. They bring customers to the branch managers in exchange for a commission. Once the loans are issued, the expatriates or their relatives can no longer be found.”

Despite beginning operations as a specialised bank, Probashi Kallyan Bank was enlisted as a scheduled bank by Bangladesh Bank in 2018. While a license was obtained to begin transactions as a commercial bank, that has not been possible over the last eight years. Due to the lack of its own core banking solution, the bank’s operations are being carried out with the assistance of other banks. The bank has not yet been able to join Bangladesh Bank’s interbank transaction platform.

Probashi Kallyan Bank’s operational failure was also highlighted in the White Paper published by the former interim government. In this regard, it was recommended to evaluate the bank’s financial capacity. The White Paper’s recommendations stated that to increase the bank’s effectiveness, it is necessary to appoint experienced retired bankers as chairman of the Board of Directors. The number of bureaucrats should be reduced, and individuals with knowledge of bank management should be included on the board.

Arif Hossain Khan, executive director and spokesperson for Bangladesh Bank, believes that once unethical practices take root in a bank from the beginning, it becomes difficult to correct them. He told Bonik Barta, “The central bank has now taken a strict stance against any form of irregularity or corruption. If any irregularities are detected during our inspections, strict action will be taken.”

He further added, “Since Probashi Kallyan Bank has become a scheduled bank, it’ll no longer receive special privileges regarding defaulted loans. In this regard, it must comply with the default loan policies just like other banks."