After the bail out of Farmers bank by the four state owned banks, Sonali, Janata, Rupali and Agrani bank, as well as the Investment Corporation of Bangladesh, to the tune of 715 crore taka, the image crisis that had virtually destroyed the credibility of Farmers bank still ensues, and the new management of the crisis struck bank intend for a fresh makeover starting with renaming the bank "Padma Bank".

Farmers Bank had endured a torrid time in the market in 2017 and 2018, and had brought the gross irregularities in the banking sector into the limelight, especially involving massive loan defaults and several other irregularities in the running of the banking sector.

There were many instances where the bank failed to pay back its depositors between the period of 2017 to 2018, amongst which there were even deposits of state-owned enterprises, and had caused a severe confidence crisis in the market, which not only resulted in its customers clambering for drawing out their deposits, but had also prevented others from carrying out any transactions with the bank. The bank has regularly failed to pay back depositors regularly since November, 2017.

Following these events, the Bangladesh Bank stepped in and played a role in the subsequent resignation of its Chairman, Mohiuddin Alamgir Khan, and also the chairman of its audit committee, Md Mahbubul Haque Chisty. In addition, the central bank also assisted in the bail out of the bank to prevent a possible dissolution by having four state owned banks and one financial institution to purchase equity shares in Farmers bank.

Despite all these steps towards creating a positive change in the bank's outlook, the number of default loans at the bank stood at Tk 3,071 crore, up from Tk 723 crore at the end of last year. As of September 2018, its non-performing loans accounted for 58 percent of its total outstanding loans of Tk 5,311 crore, up from 29 percent of its total outstanding loans in June 2018, an incredibly alarming amount especially compared to the health of the banking sector in Bangladesh as a whole.

According to reports from Bangladesh bank, it is thought that more than 3500 crore taka had been siphoned out of the bank over the past few years, coupled with gross irregularities in the running of the bank as a whole, with most of the blame falling to its former Chairman.

The state of the newly formed bank puts great stress on the banking sector, and continues the bank to be unable to turn any profit whilst its outstanding loans continue to grow, as even regular borrowers suddenly seem to move towards not paying back their loans.

The new management and board of the bank, with 9 new directors being representatives of different financial institutions amongst which five Managing Directors of the state owned banks and financial institutions which had previously bailed out the bank were named directors in the banks board.

The new management has been working hard towards improving the image of the bank as a whole, and according to the new Chairman, Chowdhury Nafeez Sarafat, the bank has been able to recover 600 crore taka since the new management took charge. They are making moves towards carrying out an external functional audit of the bank to determine the real health of the banking institution as well as implementing new campaigns to increase depositors.

Bangladesh bank shall issue an amended license to the bank once its renaming is complete and also issue a circular to the banking sector. The new management hope that this complete overhaul of its identity shall restore confidence and welcome new impetus to the health of the bank. It still remains to be seen how much change this overhaul shall truly bring to the bank as a whole.