Md Mehmood Husain is the new Chairman of IFIC Bank PLC. He was recently appointed as part of the bank's reform and restructuring efforts, which are co-owned by the government and private sectors. With four decades of banking experience, this banker has also served as the Managing Director and Chief Executive Officer of National Bank, Bank Asia, and NRB Bank. He is discussing IFIC's financial situation, governance, and reforms with Bonik Barta. Emamul Hasan Adnan conducted the interview.

It has been two weeks since you took on the role of Chairman of IFIC Bank. After this period of homework, what are your thoughts? What do you see as the bank's greatest strengths?

IFIC is the oldest bank in the country. It began operations in 1976 as a financial institution called International Finance Investment and Commerce (IFIC) under public-private ownership. In 1983, it transformed into a full-fledged commercial bank. The government has owned 32 percent of its shares since its inception. This ownership remains intact. Therefore, IFIC's position is very strong. There is a blend of the government's thoughts and establishment with the ideas of private entrepreneurs in this bank.

Another significant strength of the bank is its extensive reach. Over the past 10-12 years, IFIC has expanded its network nationwide. The bank claims to have the largest network in the country, which is accurate in terms of reality. This extensive network has allowed IFIC to align its vision with the path of inclusive banking. Through this broad network, the bank provides modern, technology-driven, inclusive banking services to remote areas of the country.

IFIC's "One Stop Service" has been warmly received by customers. This service offers 20-21 banking services to customers in one go at a single desk. Typically, banking services are spread across various departments and desks, requiring customers to visit different places for different services. IFIC has ensured that all services are available to customers at a single desk.

You mentioned that IFIC's strength lies in delivering inclusive banking services to remote areas. What feedback are you receiving on deposit collection, loan distribution, and other areas?

There is positive and robust feedback. Despite being an older bank, just three to four years ago, IFIC Bank did not have a huge customer base. The rapid growth and expansion of the customer base have primarily occurred through the establishment of "neighborhood" (sub-branches) and the provision of the "My Account" service. IFIC's sub-branches are referred to as neighborhoods, bringing IFIC's services right next to the customer's home. Just as you can see a neighbor when you step out of your house, you can also see IFIC. Since introducing this neighborhood concept and the My Account service, we have seen 30,000 to 35,000 new customers each month opening My Accounts. The expansion of IFIC's network, the efforts in inclusive banking, and the innovation brought about by the My Account initiative have all been warmly welcomed by customers.

What is the current status of IFIC's structure, including deposits and loans, as well as the expansion of its branches and sub-branches?

In December of last year, IFIC achieved a milestone of BDT 500 billion in deposits. We currently have a loan portfolio of BDT 440 to 460 billion. Within our structure, we have subsidiaries operating in the country's stock market. However, our investment banking activities are not performing very well in the market—there are valid reasons for that—our presence and existence in the market are still significant. Additionally, our money exchange service facilitates the smooth and risk-free transfer of remittances from expatriates back to the country. At present, IFIC has 1216 sub-branches and 188 branches across the country.

Bangladesh Bank dissolved the board of IFIC, citing deficiencies in governance, and appointed you to lead the bank. Since taking on the role of chairman, how would you assess the quality of the distributed loans? How secure do customers hold the deposits?

There was indeed a deficiency in governance at IFIC Bank, which has been widely discussed and reported in the media. Bangladesh Bank was also aware of this situation. It is precisely because of this lack of governance that a portion of the bank's investments did not adhere to the standards of professionalism that should have been maintained. This led to the intervention by the Bangladesh Bank.

Due to the interference of politically influential individuals, some mistakes and hasty decisions were made in loan distribution, which somewhat affected the quality of the bank's investments. 

However, from what I have learned, among the 11 banks where the Bangladesh Bank intervened, IFIC's situation is not as deep as that of others. It remains manageable. I do not see any reason for concern regarding investments. This can be rectified, but it may take some time. If we continue to move forward with the appropriate strategies, we can overcome these losses. Depositors at IFIC have no reason to be worried. There have been no instances where IFIC Bank has been unable to issue checks, fixed deposits, or make payments to customers who came to withdraw money or transfer to other banks.

Does that mean IFIC's cash flow is entirely normal?

It is still expected. I believe the cash flow will remain stable. Some depositors are confused and anxious based on the rumors and poorly informed opinions or reports spread on social media. Aside from a few issues, we have not observed anything that could undermine the trust of our depositors.

You are suggesting that the reactions and loss of confidence observed in other banks after their boards were dissolved have not occurred in the case of IFIC?

No, there has been no incident of loss of confidence. The trust among IFIC Bank depositors should be even stronger now. This is because the Bangladesh Bank has appointed a board free from political influence and consists of highly experienced and professionally skilled individuals. Therefore, confidence should now be expected to increase further.

What is your message to the depositors as chairman of the reconstituted board of IFIC Bank?

I want to deliver a clear message. The student-public movement and the uprising have given us the country's second independence. This freedom has come at a significant cost and earned through the sacrifice of many lives. This independence has provided us with an opportunity to reform our country anew. During the Liberation War, we were young and spoke of nation-building. Now, we are talking about reforming the nation. The reforms needed to hand over this country to the next generation, to stand tall and strong in the future, are what we are focused on. IFIC is also undergoing reforms.

Under the leadership of the current board, the management of IFIC will be revamped and made more dynamic. Everyone has professional knowledge, though some may have more than others. However, the current crisis has arisen due to unquestioning loyalty. Disregarding professionalism and blindly following directives have harmed the bank and institutions. This has occurred due to a lack of integrity and the decline of banking ethics among those in charge. We want to instill a sense of policy and responsibility among our employees. Necessary training and all measures will be taken to achieve this. IFIC has not built such an extensive network solely for collecting deposits. Through our branches, we will work to invigorate the rural economy by financing SMEs and small and cottage industries. Our future goal is to assist in reviving local economic activities and nurturing new entrepreneurs.