In an unprecedented regulatory intervention under the newly enacted Bank Resolution Act, 2026, Bangladesh Bank has formally declared four non-bank financial institutions (NBFIs) non-viable, dissolved their boards of directors, terminated their chief executive officers, and appointed official administrators to take full operational control.
The decisive action marks the initiation of Bangladesh's first structured resolution framework for insolvent financial institutions.
To protect retail depositors, the government and central bank have earmarked Tk2,700 crore to execute an immediate Phase 1 payout of up to Tk10 lakh per individual account holder.
Subsequent liabilities will be settled through the systematic liquidation of institutional assets and aggressive recovery of defaulted loan portfolios.
4 NBFIs declared non-viable are Aviva Finance Limited, FarEast Finance & Investment Limited, FAS Finance & Investment Limited, and International Leasing and Financial Services Limited (ILFSL).
Each non-viable NBFI has been assigned one temporary administrator and two assistant administrators to safeguard assets and manage claims.
Total deposit exposure across the resolution pipeline stands at Tk13,030 crore, of which individual retail deposits account for Tk3,003 crore.
Defaulted loan ratios across the targeted NBFIs reached near-total levels by late December, ranging from 93.93% to 100%.
Non-Bank Financial Institution (NBFI) | Total Deposit Liabilities | Individual Retail Deposits | Defaulted Loan (NPL) Ratio | Regulatory Status |
Aviva Finance Limited | Tk5,217 Crore | Tk810 Crore | 93.93% | Non-Viable / Administrator Appointed |
International Leasing (ILFSL) | Tk3,560 Crore | Tk646 Crore | 99.44% | Non-Viable / Administrator Appointed |
People's Leasing (PLFS) | Tk3,415 Crore | Tk1,406 Crore | ~95.00% | Final Liquidation / Awaiting Court Clearance |
FarEast Finance & Investment | Tk450 Crore | Tk36 Crore | 98.50% | Non-Viable / Administrator Appointed |
FAS Finance & Investment | Tk389 Crore | Tk105 Crore | 100.00% | Non-Viable / Administrator Appointed |
TOTAL | Tk13,031 Crore | Tk3,003 Crore | — | Tk2,700 Crore Allocation Secured |
Under the Bank Resolution Act 2026, the initial Tk10 lakh payout serves as an immediate liquidity buffer rather than a cap on total legitimate claims.
Account balances above Tk10 lakh remain fully recorded as active claims against the institution’s asset recovery pool.
- Deposits up to Tk10 Lakh (e.g., Tk2 Lakh, Tk6 Lakh, Tk10 Lakh): Eligible for full 100% reimbursement during Phase 1.
- Deposits Exceeding Tk10 Lakh (e.g., Tk25 Lakh, Tk1 Crore): Account holders receive Tk10 lakh upfront in Phase 1; remaining claims (e.g., Tk15 lakh or Tk90 lakh) are queued for Phase 2 and Phase 3 settlements funded through NPL recoveries and property auctions.
Regulatory context
While Aviva, FarEast, FAS, and ILFSL have passed into direct administrator control, Bangladesh Bank is handling other troubled institutions through distinct regulatory tracks:
- People's Leasing & Financial Services (PLFS): Included in the Tk2,700 crore retail payout scheme. However, formal administrator takeover requires dissolving its court-appointed board, for which Bangladesh Bank has already filed high court petitions.
- 4 NBFIs granted restructuring timelines: Bangladesh Industrial Finance Company (BIFC), Premier Leasing, GSP Finance, and Prime Finance have been granted a limited operational window to improve liquidity and capital adequacy ratios before facing potential resolution enforcement.
"Enforcing the Bank Resolution Act 2026 provides a structured legal mechanism to ring-fence small savers," stated financial sector analysts.
"Releasing up to Tk10 lakh upfront resolves distress for the vast majority of retail account holders while central bank administrators take control of corporate assets."
Regulatory experts emphasize that complete financial recovery depends on aggressive legal enforcement against habitual defaulters.
"Direct government funding stabilizes the initial phase, but recovering remaining institutional and large individual deposits will require court-ordered property liquidations and cross-border asset tracing."
Directives for depositors
To ensure seamless claim processing during administrator verification, Bangladesh Bank advises depositors to adhere to five essential protocols:
- Preserve Documentation: Secure original Fixed Deposit Receipts (FDRs), bank statements, deposit slips, cheques, and official correspondence.
- Verify Balance Records: Cross-check personal deposit records against official administrator ledger notices.
- Follow Official Channels: Submit claims strictly through central bank or administrator-sanctioned portals, avoiding third-party brokers.
- Reject Unofficial Solicitations: Do not engage with unauthorized intermediaries offering expedited payouts for fees.
- Monitor Official Announcements: Rely exclusively on official press releases from Bangladesh Bank and appointed administrators.
The declaration of four non-viable NBFIs under the Bank Resolution Act 2026 replaces years of operational insolvency with a controlled, legal resolution process.
By combining immediate government-backed payouts for retail depositors with central bank administration, regulators are taking a definitive step to clean up financial sector liabilities and restore public trust.