Privatization of the public banks and the question of right or wrong

Banking sector is currently one of the most promising growth sectors in Bangladesh. For quite some time, the banks have been participating as a noteworthy contributor in the economic escalation of Bangladesh as we know it through sustainable savings and strategic investments. Both state-run banks and private banks are contributing in the process. However, speculating the huge success of private sector compared to that of public banks or state owned banks and the loss that it is causing to majority tax payers, many experts opined that government should privatize the state owned banks and save the sinking boat of the tax-paying citizens.

In the vast never-ending depth of corruption, the state-banks are merely hanging in the balance. Like every other government organization; the public banks are constantly being affected by the political exploitation, lack of transparency, negligence and inefficient security system. With bad debts expanding their roots there seems no sign of recovery or implementation of adequate measures .On the other hand , the banks with private ownership , aiming for maximum profit and surviving the monstrous competition , are successfully assuring good quality service and promising a bright future, not to mention the  mind blowing offers in a regulated environment . While the directors of state –run banks are failing in provide proper monitoring and protection to the risks of the bank assets, the private banks are getting awards for world class management. From the above arguments, privatizing state banks seems to be quite reasonable demand.

As plain and straight-cut as it sounds, it is just one side of the coin. While many experts and locals random demand the privatization of the public bank, they seldom recall why public banks where set up in the first place .State owned banks are there to ensure proper distribution of the wealth among all classes of people. Investing in the major national infrastructures and development works the national banks ensure the impartial service for the people. Honestly, profit oriented private banks with steep charges and inhuman working hours for the employees deprive the workers of a comfortable family life and cruelly realize the loaned money. Whereas, the social welfare oriented government banks give the employees a relaxed working environment along with the considering attitude towards the loaners.

Privatizing the banking sector totally would mean closing the doors of wholesome life for many millions of banker’s .Not only that, the risk of inequality regarding wealth concentration will increase many folds. It is said that the public banks are “problematic”; ironically, the ones who proclaim it are the main cause of this problem. If a hand is injured , we never discard the hand as a whole .We try and fix what is wrong .Surely , the public  banks regulation system is flawed , but annulment of the idea of state ownership of the banks as a whole seems a little harsh and hasty at this point. Whether privatizing the state banks right away be the best solution or not is something to reconsider.