April 15, 2024, 3:32 pm

Staff Correspondent

2024-03-28 20:46:41 BdST

Banks’ CSR spending drops 38pc in Jul-Dec 2023

The country’s banking sector spent 38.28% less for their corporate social responsibilities (CSR) during the second half of 2023, compared to the first half of that year.

According to the Bangladesh Bank’s statistics, the commercial banks’ CSR-related expenditure amounted to Tk572 crore during the January-June period last year, which dropped to Tk353 crore in the July-December period of the same year.

Bankers said that last year all banks faced a number of challenges, such as slow growth in profits, huge amount of non-performing loans (NPLs), liquidity shortage, capital shortfall, and a lack of corporate governance. Also there was a global crisis stemming from the ongoing wars in different countries which led to reduced CSR expenditure.

According to the Bangladesh Bank data, banks’ CSR-related spending was the highest – Tk72.91 crore – in the education sector in the second half of 2023. The second highest amount – Tk72.30 crore – went to the health sector. The environment and climate change adaptation sector received the third biggest fund allocation – Tk14.32 crore.

In the first six months of 2023, banks’ CSR-related expenditures in education, health, and environment and climate change sectors were Tk90.19 crore, Tk217 crore and Tk50 crore, respectively.

As per rules, banks have to invest 30% of their CSR fund on education, 30% on health and 20% on disaster management and climate change adaptation. Additionally, they have to send 5% of their CSR funds to the prime minister’s Education Assistance Trust, according to the central bank’s directive.

However, as per data, the banks’ CSR spending in education sector was 20.65%, in health 20.48%, and in environment and climate change adaptation 4.06% in the second half of 2023.

Most of the CSR funds – 97.55% – came from 43 private commercial banks, followed by foreign commercial banks with a share of 1.83%.

Five banks spent nothing for CSR in the second half of last year. They were: Bangladesh Krishi, Rajshahi Krishi Unnayan Bank, Bangladesh Commerce bank, Padma and National bank of Pakistan.

The banks that spent most for CSR in the second half of 2023 were the Islami Bank Bangladesh – Tk53 crore, followed by the Dutch-Bangla Bank – Tk32 crore, the Southeast Bank – Tk30 crore, the Union Bank – Tk24 crore, the Social Islami Bank – Tk22 crore, the Mercantile Bank – Tk 21 crore, the Jamuna Bank – Tk18 crore, the Exim Bank – Tk14.95 crore, the Shahjalal Islami Bank – Tk14.86 crore.

The other banks spent less than Tk10 crore on such initiatives due to their ailing financial health.

In 2008, the Bangladesh Bank took initiatives to ensure that 61 banks and 35 leasing companies in the country make appropriate allocations for CSR activities.

Unauthorized use or reproduction of The Finance Today content for commercial purposes is strictly prohibited.

Popular Article from Bank