A recent audit report has uncovered widespread financial and administrative irregularities at the Agricultural Development Bank, revealing billions of rupees in questionable transactions, uneven loan distribution, weak governance, and serious failures in the bank’s lending practices.
According to the audit findings, the institution, established to support Pakistan’s agricultural sector and provide financial assistance to farmers, has shifted much of its focus away from agricultural lending. Instead of prioritizing credit for farmers, the bank invested a significant portion of its resources in government securities.
The report states that out of the bank’s total assets of Rs577 billion, nearly 71 percent, amounting to Rs414 billion, was invested in government securities. These investments generated profits of approximately Rs81 billion, while financing provided directly to farmers remained limited to only Rs29.5 billion, raising concerns about whether the bank is fulfilling its primary mandate.
The audit also highlighted a major imbalance in the distribution of agricultural loans across the country. During the last five years, the bank disbursed loans worth Rs364 billion, of which Rs307.5 billion was allocated to Punjab alone. In 2024, nearly 85 percent of the Rs72 billion in loans issued went to borrowers in Punjab, while Sindh, Balochistan, Khyber Pakhtunkhwa, and Azad Jammu and Kashmir collectively received only 15 percent, prompting questions about equitable access to agricultural financing.
The report further disclosed serious concerns regarding recruitment and administrative management. One of the most striking findings was the appointment of a 78-year-old IT consultant, who reportedly received a salary package worth Rs24.7 million. Auditors questioned the transparency of the hiring process and pointed to broader weaknesses in the bank’s recruitment and governance systems.
Loan recovery also emerged as a major area of concern. According to the audit, the bank’s loan recovery rate remained unsatisfactory, with 44 percent of outstanding loans—valued at approximately Rs80.62 billion—remaining unpaid. Over the past five years, defaulted loans exceeded Rs53 billion, placing additional financial pressure on the institution.
Investigators also identified evidence suggesting that some loans were approved using forged documents, while irregularities involving fake insurance claims and fraudulent paperwork were also detected. These findings have raised serious questions about the effectiveness of the bank’s internal controls and risk management mechanisms.
The Auditor General of Pakistan has expressed concern over the bank’s weak credit risk management framework and administrative shortcomings. The audit report recommends strict action against officials found responsible for negligence or misconduct and calls for accountability to recover losses suffered by the national exchequer.
