Bad loans at non-banking financial institutions (NBFIs) shot up by Tk2, 920 crore in the first half of this year due to widespread irregularities and corruption.
Total bad loans of 34 NBFIs stood at Tk15,936.42 crore as of June this year, almost 22.99% of the sector’s total outstanding loans of Tk69,331.72 crore, according to Bangladesh Bank’s latest data.
Defaulted loans of NBFIs stood at Tk13,016 crore at the end of December of last year and increased by Tk5,608.42 crore in the last one year until June this year.
The NBFI sector has been saddled with huge bad loans due to widespread irregularities and scams, according to central bank officials.
Only five to six NBFIs out of 34 were doing well, they said.
The central bank data showed that 10 NBFIs held 80% of bad loans in the sector.
A Bangladesh Bank inspection team recently found huge irregularities and scams in 10 NBFIs, including People’s Leasing, International Leasing, Premier Leasing, Uttara Finance, and First Finance.
In June 2019, the Finance Ministry ordered the central bank to close People’s Leasing and Financial Services because they had failed to reimburse depositors’ money despite the funds’ maturity.
The decision exacerbated the sector’s problems, but instead of liquidating the NBFI, the government chose to restructure it.