Summary:
- Janata Bank’s non-performing loans (NPLs) hit a record ৳67,300 crore (66.8% of total loans) by December 2024, driven by defaults from politically connected conglomerates post-regime change.
- Beximco Group (linked to ex-PM’s adviser Salman F Rahman) tops defaulters with ৳23,000 crore, followed by S Alam Group(৳10,200 crore) and AnonTex (৳7,800 crore).
- Loans to these entities violated central bank exposure limits, with Beximco’s debt exceeding 950% of Janata Bank’s capital, triggering severe liquidity crises and a ৳20,000 crore bailout request.
- Historic irregularities include ৳3,527 crore in questionable loans (2010–2015) and a1,055% NPL surge since 2017, with recovery efforts now prioritizing legal action against top defaulters.
Janata Bank, one of Bangladesh’s largest state-owned commercial banks, faces an unprecedented crisis as its non-performing loans (NPLs) surged to a record ৳67,300 crore by December 2024. This staggering figure represents 66.8% of the bank’s total loan portfolio of ৳1.80 lakh crore, marking the highest NPL ratio in Bangladesh’s banking sector.
Key Defaulters and Loan Concentrations
The crisis stems primarily from defaults by politically connected conglomerates:
- Beximco Group (associated with former PM’s adviser Salman F Rahman): ৳23,000 crore
- S Alam Group: ৳10,200 crore
- AnonTex: ৳7,800 crore
- Crescent Group: ৳3,800 crore
Bank officials revealed that 70% of bad loans are concentrated among the top five defaulters. “Major borrowers like Beximco and S Alam completely stopped repayments after the August 2024 political transition,” a senior executive disclosed anonymously.
Political Links and Regulatory Failures
The NPLs skyrocketed by ৳19,300 crore in just six months following the political regime change. Loans previously classified as regular suddenly turned bad as influential borrowers ceased payments. Beximco’s debt alone exceeds 950% of the bank’s capital base, violating the 25% single-borrower exposure limit.
Historical Context and Systemic Risks
This crisis continues a decade-long pattern:
- 2010-2015: ৳3,527 crore irregular loans to AnonTex subsidiaries
- 2017 NPLs: ৳5,818 crore
- June 2024 NPLs: ৳48,000 crore
The bank now faces severe liquidity constraints, requiring a ৳20,000 crore emergency bailout from the central bank. Recent attempts to recover loans include legal action against major defaulters and negotiations for debt rescheduling with groups like Basundhara (৳1,700 crore exposure).
Recovery Efforts and Challenges
Newly appointed Managing Director Md. Mojibor Rahman emphasized: “We’re implementing aggressive recovery measures while ensuring depositor protection.” However, analysts warn that political interference in loan approvals and weak corporate governance continue undermining reform efforts. Financial experts are urging forensic audits to identify responsible officials and board members.
