An investigation by Bangladesh Bank, the country's central bank, has found that four commercial banks have made illegal loans to local businessmen.

"An investigation has found that four local private banks have sanctioned 3.3bn taka ($57m) loans to three businessmen and their companies through illegal process," a senior central bank official said.

The investigation also found that the companies and their executives were involved in money laundering, he added.

Last week, Bangladesh has topped a survey by the business funded lobby group Transparency International as the most corrupt country in the world for the second year running.

Time to reply

The managing directors of the banks have been served with notices asking them to explain why they should not be held responsible for sanctioning the loans, the official said.

They have been given 15 days to reply.

The central bank named National Credit and Commerce Bank Limited (NCCBL), Dhaka Bank, National Bank Limited and One Bank as the banks involved.

One Bank is a private bank but the remainder are listed on Bangladesh's main Dhaka Stock Exchange and the Chittagong Stock Exchange.

Shares in NCCBL ended down 0.13% at 189.75 taka while Dhaka Bank fell 0.81% to 244 taka.