Ansar-VDP Unnayan Bank

Ansar-VDP Unnayan Bank established on 16 September 1995 as a body corporate under the Ansar VDP Unnayan Bank Ordinance, 1995. The bank commenced its activities in November 1996 with an authorised and paid up capital of Tk 1,000 million and Tk 100 million respectively through opening a local office in Dhaka. Of its total paid up capital, 25% was paid by the government of Bangladesh and the remaining 75% by members and officials of Ansar and VDP and the employees of the bank itself. On 30 June 2000, the bank's paid up capital increased to Tk 130 million. The bank was set up basically to provide microcredit facilities to Ansar-VDP members for house building and other economic activities with or without collateral and for performing other activities under specific instruction of bangladesh bank.

In March 2000, the bank had 72 branches with a total of 388 employees, including 325 officers working under the overall governance of the managing director at its head office at Dhaka. A manager accountable to the managing director, the chief executive officer of the bank, heads each branch. The bank follows group-based multipurpose micro-credit lending policies to finance various rural income generating activities. List of these activities includes beef fattening, poultry farming, fish and shrimp culture, small and cottage industries, light engineering workshops, trade in grocery items, buying sewing machines and marketing of agricultural products. The bank plans to expand credit facilities to at least 60 types of income generating activities. To avail the credit facilities of the bank, a borrower must be a member of a group of five. A member is given a maximum loan of Tk 15,000 without any security or collateral, but the group is to provide a guarantee for the credit. It has been made mandatory for every member of a group to make a compulsory weekly deposit of Tk 5 with the bank. The bank pays interest @ of 7% per annum on group savings. 

The principal objective of such savings schemes is to let members understand the impact of savings in the long run and develop their savings habit. In addition to its group-based micro credit facilities, Ansar VDP Unnayan Bank also provides project loans with or without equity participation and collateral depending upon the feasibility of projects. Up to March 2000, the bank disbursed a total of Tk 470 million as credit to its 78,633 members throughout the country. The installment-based recovery of these credits in the mean time stood at Tk 37 million registering a 99% recovery rate.

The bank started its operations in 1996 with total assets of Tk 31.87 million. The value of the bank's total assets stood at Tk 185.46 million on 30 June 1999. The investment of the bank is its balance with other banks and financial institutions kept in various savings accounts and stood at Tk 39.75 million on 30 June 1999 compared to Tk 27.90 million in 1996. Major sources of operating funds of the bank are savings from its members and loans from the PKSF (Palli Karma Sahayak Foundation, the apex government organisation to promote micro-credit programmes). In 1998-99, the bank earned an income of Tk 27.11 million against its total expenses of Tk 30.79 million. Up to 30 June 2000, accumulated losses of the bank amounted to Tk 8.94 million.