The bank has downgraded its salary structure to minimise operational costs
Though the kingpins behind the BASIC Bank loan scam have remained untouched even in seven years, the general employees are now having to suffer the consequences as the bank has moved to cut their salaries in a bid to rein in operational losses.
Once one of the healthiest banks in the country operating on an independent salary structure, it has decided to come in line with the salary structure of the other state-owned banks.
In this regard, an official order was issued on Sunday saying that the bank has cancelled its existing independent salary structure and that it has adopted a structure akin to that followed by other state-owned banks.
The letter said the employees of BASIC Bank are being paid higher salaries compared to other state-owned banks.
As the bank has been operating at a loss for the last seven years it is now unable to support this high scale of salaries, the letter read.
Against this backdrop, the bank has decided to cancel the existing salary structure, alongside cancelling other extra financial benefits, according to the letter.
The decision would come into effect from December 22, 2019.
The number of total employees in BASIC Bank was 2,086 as of 2018.
The decision to downgrade the salary sparked fury among the employees of the bank on Monday.
All employees at the head office of the bank kept Managing Director Md Rafiqul Alam confined to his room for the whole day, protesting the decision.
Currently, the employees of BASIC Bank are paid the highest among all state-run banks. If the new decision comes into effect, they will face a minimum 20 percent reduction in their salaries, according to the bank.
When contacted, Alauddin A Majid, chairman of the bank said the bank has been incurring loss for the last seven years and that it has no ability to continue with the existing salary structure.
The loss of the bank is likely to be around Tk300 crore this year, he said.
In the four years between 2009 and 2013, Tk4,500 crore was swindled out of BASIC Bank in what is deemed as biggest financial sector fraud in the country.
Sheikh Abdul Hye Bacchu, former chairman of the bank has been mainly accused of being responsible for this corruption but no legal action has been taken against him yet.
Since the corruption was revealed in 2013, the amount of default loans with the bank continued to rise abnormally, putting the bank in loss.
In the last seven years from 2013 to 2018, the bank incurred a loss of Tk2,800 crore.
The total amount of defaulted loans with the bank increased by seven times in the same period, and it stood at Tk8,738 crore in September this year, according to central bank data.