From credit kings to debt titans: Beximco, S Alam lead top 10 with Tk 520bn in hidden defaults

Janata Bank alone holds Tk 410.86 billion in outstanding loans from seven of the 10 groups listed as major defaulters

For years, several businesses enjoyed easy access to loans, followed by generous waivers when it came to repayments. The result? The top 10 defaulters across five banks now together owe a staggering Tk 520 billion.

With the change in government, many undisclosed financial arrangements in the banking sector have now begun to surface.

It has triggered shocking shake-ups in the rankings of loan defaulters.

So much so that the "creditworthy" giants like Beximco Group and S Alam Group—which had maintained a “clean” record for over 15 years—have suddenly shot to the top of the defaulter list.

While some names in the top 10 were familiar, the appearance of three relatively unknown companies among the biggest culprits has left many in the business community stunned.

Among the five banks that dished out these loans without any checks, Janata Bank took the crown for being the most lenient.

It alone holds Tk 410.86 billion in unpaid loans from seven of the top 10 defaulter groups.

Once considered a solid state-owned commercial bank, Janata’s reputation is crumbling as the full scale of these dodgy transactions comes to light.

The list, updated by Bangladesh Bank, reveals the top 10 defaulters and the banks that irresponsibly handed over massive sums to these companies.

Among them, Beximco and S Alam, which had previously been associated with the ousted Awami League government, now make their mark alongside older defaulters like Anontex, Crescent, and Ratanpur Group.

Also making an appearance are names such as Maisha Group, linked to former Awami League MP Aslamul Haque, as well as lesser-known companies like Rimex Footwear and Ranko Group.

Even Narsingdi-based Zakia Group, barely known outside local circles, has landed at number seven.

Two years ago, in January 2023, the Sheikh Hasina government published a list of the top 20 defaulters in parliament.

Back then, Beximco, S Alam, and six other groups from the current top 10 were nowhere to be seen.

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Top 10 defaulters:

• Beximco Group, S Alam Group, AnonTex, Maisha, FMC Group of Companies, Crescent Group, Ratanpur Group, Zakia Group, Rimex Footwear Limited, and Ranko Group.

• Total defaulted loans: Tk 518.56 billion.

Top 5 banks struggling with defaults:

• Janata, Agrani, Sonali, National, and Union Bank.

Top 10 banks burdened with defaults:

• Janata, National, Agrani, AB, Rupali, Sonali, Union, First Security Islami, Al Arafah Islami, and Trust Bank.

• These banks have over Tk 1.30 trillion in defaulted loans, each exceeding Tk 1 billion.

• Altogether, the total defaulted loans of these banks, both above and below Tk 1 billion, amount to Tk 1.83 trillion.

• This accounts for 64 percent of the total defaulted loans in the banking sector.

• As of the September 2024 quarter, the total defaulted loans in the country stand at Tk 2.84 trillion.

• Out of the 61 commercial banks in the country, 36 hold a combined defaulted loan of Tk 1.47 trillion, exceeding Tk 1 billion.

• The amount constitutes 51.70 percent of the total defaulted loans for the September quarter.

Defaults above Tk 1 billion:

• The largest chunk of defaults is in Janata Bank: Tk 523.96 billion, with total defaults at Tk 603.45 billion.

• National Bank comes in second with Tk 210.56 billion in defaults, and its total defaults are Tk 237.21 billion.

• Agrani Bank ranks third with Tk 156.28 billion in defaults, and its overall defaults stand at Tk 268.91 billion.

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Bankers are now accusing five banks, including three state-owned ones, of completely ignoring rules like single-borrower loan limits when handing out massive amounts of credit to these groups.

They argue that these groups used different tactics to open shell companies while keeping the paperwork in order, extracting funds without scrutiny.

The beneficiaries of these loans were well known to the banks' boards and officials, who saw no need for any verification or due diligence.

These claims are also evident in the statements of a former managing director of Janata Bank and other officials.

As of the September quarter, a list has been compiled of the top 10 banks and top 10 business groups with defaulted loans exceeding Tk 1 billion.

In addition, another list has been prepared of the top 10 banks that have issued loans exceeding Tk 1 billion, which have now turned into bad debt.

The officials highlighted how the political shift has brought to light new details of defaulted loans, as the special privileges from the previous administration came to an end, exposing gaps and bringing new groups and companies into the spotlight.

Bangladesh Bank spokesperson Husne Ara Shikha told bdnews24.com that they gathered information from 36 banks with bad loans over Tk 1 billion to create the list.

She added that the central bank has now asked banks to outline the actions they will take to recover these loans, with letters soon to be sent out.

The top executives of eight banks confirmed bdnews24.com that they had submitted the required data to Bangladesh Bank and received directives from the central bank to expedite the recovery of defaulted loans.

Beximco Group has topped the defaulter list this time, despite previously managing to stay off paper as a delinquent borrower.

An advisory council committee formed by interim government to assess the state of Beximco Group’s industrial park revealed that the conglomerate’s total debt exceeds Tk 400 billion.

Out of this, a staggering Tk 230 billion owed to Janata Bank has now completely defaulted.

Salman F Rahman, deposed prime minister Hasina’s advisor on private investment and industry, is the vice-chairman of Beximco Group.

While his direct shareholding in the group’s listed companies is minimal, he, along with his older brother Sohel Rahman, held control over the group’s board and management.

Top 10 Defaulters

Group	Bank	Amount
Beximco Group	Janata (193.72 billion), Sonali (14.25 billion)	208.75 billion
S Alam Group	Janata (92.73 billion), Union (24.25 billion)	117.35 billion
AnonTex Group	Janata Bank	76.86 billion
Maisha Group	National Bank	27.54 billion
FMC Group	National Bank	21.44 billion
Crescent Group	Janata Bank	20.39 billion
Ratanpur Group	Janata Bank	12.27 billion
Zakia Group	Agrani Bank	12.10 billion
Rimex Footwear Limited	Janata Bank	11.34 billion
Ranko Group	Janata B	11.32 billion
Total		518.56 billion

The country's leading group has been granted loans without restriction by Janata Bank.

Former managing director Abdul Jabbar, who took charge of the bank in 2023, told bdnews24.com: “It wasn’t even clear these loans were going to Beximco at first. After I joined, I informed Bangladesh Bank about the issue.

“Subsequently, all the institutions were consolidated into a single group, which then exceeded the single borrower loan limit."

There is a rule that no single borrower should be granted more than 25 percent of the bank’s capital (including both funded and non-funded loans).

According to Jabbar, loans were granted to Beximco's companies that were 800 times the permissible limit. He informed the central bank about this.

He claimed that after taking on the position of the managing director, he held multiple discussions with Salman Rahman on the matter.

He made it clear that it was not possible to provide loans beyond the limit.

Jabbar also informed the then governor Abdur Rouf Talukdar about the situation.

HOW NEW LOAN DEFAULT DATA CAME TO LIGHT

After the government change and the appointment of new Governor Ahsan H Mansur, Bangladesh Bank set up “Special Monitoring Cells” in commercial banks to oversee the banking sector reforms and reduce non-performing loans, or NPLs.

A deputy managing director of each bank was assigned to head these cells.

Their role is to track down loans over Tk 1 billion and report the data to Bangladesh Bank.

Bangladesh Bank spokesperson Husne Ara told bdnews24.com that banks were directed to provide updates on the measures being taken “reduce the amount of classified loans and the number of borrowers” of Tk 1 billion and above.

"Bangladesh Bank has sought details from 36 banks with NPLs exceeding Tk 1 billion, asking what measures they plan to take moving forward."

She added that banks with a higher volume of rescheduled loans have been advised to closely monitor and ensure regular loan instalment collection, to prevent these loans from being reclassified as “non-performing”.

Top 10 Banks with Defaulted Loans Exceeding Tk 1 Billion

Bank Name	Bad Loans (in billions)	Total Bad Loans (in billions)
Janata Bank	603.45	523.96
National Bank Limited	237.22	210.57
Agrani Bank	268.92	156.28
AB Bank	101.16	85.26
Rupali Bank	127.35	81.65
Sonali Bank	165.65	71.44
Union Bank Limited	122.18	64.84
First Security Islami Bank	129.48	62.07
Al Arafah Islami Bank	49.05	23.04
Trust Bank	27.53	22.99

The spokesperson highlighted the legal hurdles in recovering loans from major industrial groups.

“The loan recovery process becomes challenging due to court injunctions, political and administrative influences, and borrowers’ reluctance to repay.”

She further said the central bank had advised banks to adopt effective measures to increase recovery rates on classified loans, hire competent lawyers for handling cases, and use alternative dispute resolution methods where necessary.

WHY ARE NEW NAMES ON DEFAULTERS’ LIST?

In January 2023, former finance minister AHM Mustafa Kamal released a list of the country's top 20 loan defaulters in parliament.

Out of Tk 192.84 billion in total loans, Tk 165.88 billion was classified as non-performing.

While the list contained 20 names, Mustafa mentioned that the total number of defaulters, including individuals and companies, stood at 786,065.

A year and a half later, Bangladesh Bank’s latest September 2024 quarter NPL report looks significantly different from the one the former finance minister shared.

The earlier list did not feature Beximco or S Alam Group.

36 Banks with Defaulted Loans Exceeding Tk 1 Billion

Bank Category	Total Loans	Bad Loans	Loans Above 1 bn (in billions)	% of Bad Loans Above 1bn
State-owned (5 banks)	3.12 trillion	1.26 trillion	838.47	66.49
Private (28 banks)	12.6 trillion	1.50 trillion	623.26	41.60
Foreign (2 banks)	650.34	32.46	3.29	10.14
Specialised (1 bank)	440.03	58.14	8.32	14.32
Total (36 banks)	16.82 trillion	2.84 trillion	1.47 trillion	51.70

Senior officials of Bangladesh Bank and several banks said the real story is coming to light following the change of government.

These groups took loans in the names of different companies. Despite receiving refinancing facilities for large borrowers, many companies failed to pay the instalments, yet the banks intentionally refrained from categorising them as defaulters. They also failed to provide accurate information to the central bank.

At times, due to pressure from influential figures, Bangladesh Bank did not send inspection teams to these banks.

Now, with the influence of these groups no longer prevalent in the banks and new boards being formed in many institutions, the details of loans taken by major groups like Beximco and S Alam—either in the name of their own companies or other companies—have been reported to the central bank.

Zahid Hussain, former lead economist at the World Bank’s Dhaka office, believes that during the previous government, it had been “pre-determined” that these influential groups would not be included in the defaulter lists.

“For this reason, banks did what was needed to keep them off the list,” he said. “They hid the data and did not provide accurate information to the central bank.

“At the time, these groups were extremely influential, with direct access to top offices, including the Prime Minister's Office and senior officials in the finance ministry.

“Under such circumstances, it was very difficult to include them on the defaulter list.”

The economist provides an example: “In 2022, after Abdur Rouf Talukder took over as governor, he immediately provided widespread rescheduling benefits for loans.

“This allowed many defaulters to avoid being classified as such by paying only a small amount at the time."

BEXIMCO’S LOAN DEFAULTS SURPASS TK 1BN IN 29 ACCOUNTS

Beximco, a well-known name in the country's business sector, is at the top of the list of defaulters with loans exceeding Tk 1 billion, with a total outstanding amount of Tk 207.96 billion across multiple banks. Of this, Janata Bank alone holds Tk 193.72 billion, while Sonali Bank accounts for Tk 14.42 billion.

When the group's Vice Chairman Salman Rahman was arrested and sent to jail, banks classified the loans taken under the names of different companies, set up by the conglomerate and its beneficiaries, as defaulted.

Now, the banks are facing complications in recovering these loans.

According to a senior official of Janata Bank, which is struggling the most with the largest loans to this group, there are defaulted loans exceeding Tk 1 billion in the accounts of 29 companies under the Beximco Group.

In addition, there are other accounts with defaulted loans below Tk 1 billion, and efforts are ongoing to determine their number.

Abdul Jabbar, the former MD of Janata Bank, said Beximco began taking loans from the bank in 1978.

However, up until 2014, the group only refinanced its loans and did not open new companies to take out loans.

It was after this period that the group started using a new strategy, establishing different companies and withdrawing funds from the bank.

However, since 2016, such irregularities and strategies have become more frequent.

A senior Bangladesh Bank official said although senior officials at Janata Bank were aware of these loans being taken under different company names, circulating through several accounts and eventually reaching Beximco, the central bank could not grasp this situation at the time as the bank had not reported it.

Labour and Employment Advisor M Sakhawat Hussain, head of the advisory council committee reviewing the state of Beximco Industrial Park, confirmed that multiple shell companies were identified within the group.

On January 23, he revealed that 16 of the 32 factories within the park did not actually exist.

He further disclosed that Beximco had secured Tk 120 billion in loans using these non-existent companies.

S ALAM’S DEFAULT TOTALS OVER TK 90BN IN A SINGLE BANK

S Alam Group, another influential business conglomerate benefiting during the tenure of the ousted Awami League government, had control over the boards of many private banks, including Islami Bank.

Governor Mansur has repeatedly claimed that over Tk 1 trillion was drained from these banks through several methods.

In addition, the group failed to repay loans taken from government banks, pushing them to second place on the Bangladesh Bank’s list of top loan defaulters.

Despite this, the group had never appeared on the defaulters' list for over a decade and a half.

Currently, S Alam Group has a total defaulted loan exceeding Tk 117.34 billion, with Tk 92.72 billion owed to Janata Bank and Tk 24.61 billion to Union Bank.

The board of Union Bank, a private fourth-generation bank, was under the control of the family of Mohammad Saiful Alam, chairman and managing director of S Alam Group.

A senior official from Janata Bank said 16 accounts of S Alam Group in the bank have defaulted on loans exceeding Tk 1 billion.

In addition, several other accounts with defaults below Tk 1 billion are also being identified.

According to relevant officials, year after year, S Alam Group has taken excessive loans from Janata Bank. Among these, loans worth Tk 77.47 billion were taken in 2005, 2009, 2010, 2015, and 2017 under different companies' names.

In addition, S Alam Cold Rolled Steels took loans worth Tk 19.51 billion in 2010, 2020, and 2021, all of which are now defaulted.

JANATA STRUGGLES WITH ANONTEX DEFAULTS

Anontex Group, a controversial name in the garment sector for misusing bank funds, has racked up loan defaults amounting to Tk 76.86 million from Janata Bank.

As many as 19 of its companies each owe over 1 billion.

Bank records show that in 2010, the group’s company, Galaxy Sweaters & Yarn Dyeing, secured its first loan of Tk 80 million, which was initially repaid.

However, borrowing escalated under multiple subsidiaries, most of which belong to the textile and apparel sector.

Despite exceeding the single borrower loan limit, Janata Bank continued lending to Anontex without securing approval from Bangladesh Bank.

Attempts to reach AnonTex Managing Director Younus Badal via phone went unanswered.

NATIONAL BANK STRUGGLES WITH DEFAULTS FROM MAISHA, FMC

National Bank, one of the first-generation private banks in the country, is facing a severe financial crisis primarily due to substantial loans given to Maisha Group, a company linked to the former Awami League MP late Aslamul Haque. The group’s defaulted loans have now surged to Tk 27.54 billion.

An assistant managing director of the bank said following Aslamul’s death, Maisha Group began accumulating non-performing loans.

Efforts have begun to auction mortgaged properties, and the land belonging to the group has already been surveyed.

In 2021, after taking over the business, Aslamul Haque’s wife, Maksuda Haque, informed several banks that she would be unable to repay all outstanding debts.

Attempts to obtain her comments on the bank’s recovery efforts were unsuccessful.

One of these businesses, the FMC Group, a shipbuilding and ship repair company based in Chittagong, has also faced massive defaults.

The group, owned by Yasin Chowdhury, has accumulated a defaulted loan amount of Tk 21.43 billion with the National Bank.

The bank has classified FMC’s shipyard company as a "deliberate" defaulter, and legal action has been initiated.

When contacted for a statement, a representative from FMC's dockyard company, Morshed, declined to comment.

"I don’t want to discuss this. I am ending the call," he said.

Attempts to contact him again were unsuccessful, and no comment was received from the group’s owner Yasin.

WHAT BANKS ARE SAYING

Md Mazibur Rahman, managing director of Janata Bank, told bdnews24.com that the central bank and the finance ministry have issued directives to recover defaulted loans exceeding Tk 1 billion swiftly.

A dedicated division has been set up to monitor this process.

He added that the sale of S Alam's assets is under consideration for recovery of funds, adding that legal proceedings are ongoing and the court is being regularly updated.

Following a shift in power, Abdul Awal Mintoo, who returned to the position of chairman of National Bank's board, told bdnews24.com that efforts are under way to reduce non-performing loans in collaboration with Bangladesh Bank. The focus has been placed on recovering loans from defaulters with amounts exceeding Tk 1 billion.

He said more details would be shared in the future.

"There has been significant corruption under the previous management. No regulations were followed when issuing loans.

“During that time, several groups took loans of over Tk 1 billion, and they are now in default. We are trying our best to resolve this."

Syed Abu Naser Bukhtear Ahmed, chairman of Agrani Bank, said over the past 15 years, certain groups have wreaked havoc on the banking sector.

During this period, many successful entrepreneurs were denied loans, while influential figures secured amounts ranging from Tk 1 billion to Tk 5 billion.

Their failure to repay has pushed banks into financial turmoil.

“We are working on strategies to recover these non-performing loans,” he added.

AB Bank Managing Director Syed Mizanur Rahman told bdnews24.com, "Since the change in power, money has been recovered from influential groups.

“They were uncooperative in the past, but since the shift in power, they are providing assistance, enabling the recovery of defaulted loans," he added.

[Writing in English by Sheikh Fariha Bristy]