ISLAMABAD: The supreme decision-making body of the Quaid-i-Azam University (QAU) seemed helpless before autocratic and oppressive management, as it has thus far failed to comply with the directives regarding taking back the invested money amounting Rs 160 million in a low-ranked commercial bank.
As per the documents available with Daily Times, the QAU senior administration in 2015 deposited Rs 160 million in the Dubai Islamic Bank (DIB) Sector G-9 Markaz, Islamabad, for a three-year time period.
The then syndicate in its meetings held in April and September last year had directed the university administration to get back the money from the DIB and invest it in the best considered bank.
“The syndicate asked the university to get back their invested money from the DIB and re-invest the money on a short-term basis in any government-approved bank. The syndicate felt that the credit rating of DIB was not sufficiently high,” reads a copy of the draft minutes of the syndicate findings, obtained by this correspondent.
However, QAU Vice Chancellor Dr Javed Asharf told this scribe that he had filed an appeal with the president of the country and chancellor of the varsity, Mamnoon Hussain, against the syndicate’s decision.
Dr Ashraf claimed that he requested the chancellor to negotiate the said decision of the syndicate, as the selected bank was the best in ranking. However, he refused to share the copy of appeal submitted in the presidency.
The VC had filed the appeal over a year ago but nothing has been done in this regard. Interestingly, a new syndicate body has been constituted, and it also held three meetings, but the issue of investment is still hanging in the balance.
According to the world’s best bank rating agency Moodys, the bank that holds ‘AAA’ is considered “prime”, while the bank having a score of ‘AA’ is of “high status”. Moreover, the bank having ‘A’ rating is included in the upper medium category. The DIB has A grade, while other two banks, HBL and Askari Bank Limited (AKBL), have ‘AAA’ and ‘AA’ scores, respectively.
VC Dr Ashraf said that the money had been invested in the DIB believing that the bank had ‘AAA’ ranking.
On the other hand, he submitted a written justification to the syndicate in which he said that the bank had ‘A’ grade rating. The documents read that the AKBL offered the highest amount for the annual and three-year profit. The bank offered Rs 30.562 million profit amount for a three-year tenure on the depositing amount by the varsity.
The amount of Rs 160 million was purely of endowment funds, which is the savings of the varsity, while as per rules the actual amount would remain intact and the profit on this amount may be spent on scholarships, development and many other development projects in the varsity.
The sources privy to the matter disclosed that thus far the DIB did not pay even a single rupee as profit. However, the DIB G-9 Markaz Branch’s Operations Manager Raja Haider refused to share the details regarding the university’s deposits. He claimed that it was not in the “policy of bank to tell the depositor account’s details to any other person unless he/she gets the permission for this from the depositor in written form”.
Besides the less profit and low ratings, the bank did not even fully assure people about the offered profits.
“Being an Islamic Bank we cannot guarantee profits against your investment with us. However, based on the… profits [of the bank], it is expected that the customer may earn 7.3 percent per annum against investment in the Mudaraba pool,” reads a letter written by DIB to the university’s administration on the time of the agreement.
Following the letter, then treasure of the QAU, Ziaul Haq, as per the documents, also had urged the VC not to invest the money with the bank, as “it is very risky step”.
Moreover, the sources revealed that pro-vice chancellor and Minister for Federal Education and Professional Training Balighur Rehman also expressed dismay over the investment initiative of the university management.
To stick with the decision of keeping the money in the same bank is very surprising despite opposition from the syndicate, pro-vice chancellor, treasure as well as a majority of the faculty members, said a senior faculty member wishing not to be named. However, Dr Ashraf claimed that though this ‘investment’, the university had received Rs 6 million in the form of profit.