NAB may issue arrest warrant in loan default case

National Accountability Bureau (NAB) is likely to issue arrest warrant in a loan default case of the Bank of Khyber (BoK), reliable sources told Business Recorder on Monday.
The sources said that the bank had sent its largest default case to the bureau for the recovery of defaulted amount of Rs 1.2 billion from Makran Fisheries Karachi. The company had obtained a huge amount of Rs 796 million from the bank. But, had failed to pay back the amount.
According to sources in the BoK, the national anti-graft agency has assured the management of the bank that the proprietor of the Makran Fisheries had been given a deadline of December 10 for the preparation of a sale plan of their assets. In case of failure in preparation of the said plan, the NAB would issue arrest warrant of the proprietor concerned.
"In this connection, a senior official of the BoK had recently held a detailed meeting with the NAB officials," an official told on condition of anonymity.
During the meeting the officials of the anti-graft agency had assured all possible co-operation to the bank in the recovery of the outstanding loan against the Makran Fisheries.
BoK, a public sector bank owned by the NWFP government, is going to announce a new strategy for the recovery and regularisation of the non-performing loans (NPLs). The strategy is expected to be announced in the first month of the next calendar year.
The new strategy would include the deployment of one collection and recovery officer in all big branches of the bank. The bank during last year had regularised NPLs to the tune of Rs 534 million and had also recovered a handsome amount in cash. Due to the special drive launched by the bank during last two years the ratio of the NPLs, which was 44 percent, had been cut down to 24 percent.
The target of the regularisation of NPLs for the outgoing year was Rs 400 million and is likely to conservatively closed at Rs 430 million. The major contribution was the recovery of Rs 200 million in cash. The total volume of the NPLs has been reduced by Rs 411 million.
Out of the total volume of the NPLs 85 percent cases are in process of litigation, including National Accountability Bureau (NAB) and decisions of the CRC, a committee constituted by the State Bank of Pakistan (SBP) to reduce the highest inventory of NPLs in banking industry while in 88 percent cases recovery is a time-consuming task.