Six private-sector banks reported a combined loss of Tk352 crore in the July-September 2024 quarter, a sharp reversal from the Tk331.58 crore profit they achieved in the same period last year. Banks including Islami Bank, Union Bank, and Social Islami Bank (SIBL) attributed their losses to increased provisions for loans, which were largely issued under irregular circumstances during the tenure of S Alam Group’s influence. Islami Bank alone accounted for Tk89 crore of the losses, marking its first deficit in over three decades. Central bank investigations revealed significant unsecured loans, such as Union Bank’s Tk17,229 crore disbursed to S Alam-related entities.
The losses, coupled with net operating cash crises, reflect the banks’ struggles to recover from past governance failures. Share prices of First Security Islami Bank, Global Islami Bank, and SIBL dropped below Tk10 on the Dhaka Stock Exchange by November 28. Analysts warn of eroded investor confidence as governance reforms are urgently needed.
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