Janata Bank, Bangladesh’s largest state-run financial institution, has sought an urgent Tk 200 billion bailout package from the interim government and Bangladesh Bank to address its liquidity crisis, maintain cash flow, and ensure depositor confidence.
In a letter sent last month to the Financial Institutions Division of the finance ministry and the central bank, the bank requested Tk 100 billion in recapitalization from the government to address capital and provisioning shortfalls and an additional Tk 100 billion in liquidity support from the central bank at the current bank rate of 4% for five years.
Janata Bank’s managing director, Md Mazibur Rahman, confirmed the request but noted that the bank has not yet received the necessary funds.
Janata Bank holds the highest amount of defaulted loans in the sector, totaling Tk 604.89 billion as of September 2023. This constitutes 61% of its total disbursed loans and 21.22% of the country’s total non-performing loans (NPLs) of Tk 2849.77 billion.
Over 45% of Janata’s loans are concentrated among five large borrowers—Beximco Group, S Alam Group, AnonTex Group, Crescent Group, and Thermex Group—who collectively account for significant defaults. Beximco Group alone owes Tk 195.07 billion, followed by S Alam Group (Tk 105 billion) and AnonTex Group (Tk 77.08 billion).
In its appeal, Janata Bank emphasized that immediate support is critical to preventing further deterioration of its financial position. The bank warned that without intervention, the interim government could suffer potential reputational damage.
