The country's once leading Islamic bank in the private sector is now going through a recession. Those concerned believe that the bank has reached this state due to the inefficiency of the board of directors and management. A year ago, Islami Bank was one of the models in the country's banking sector, with enviable success in every indicator of the banking sector.
Islami Bank was on a positive trend. The bank is no longer in its previous position due to being under the control of an unprofessional group. Bank officials fear uncertainty in the future regarding the salaries of officials and employees and the payment of profits to depositors. They say that if there is no profit, the pressure to withdraw deposits will increase. As a result, the overall condition of the bank will deteriorate further.
It is said that the most important indicator of the bank is operating profit. According to Islami Bank sources, the operating profit of Islami Bank in 2024 was Tk 3,400 crore. Despite widespread rumors, propaganda, political unrest, and various instability including the fall of the government, Islami Bank has achieved record operating profits as always. The bank has started facing losses since the beginning of 2025. This loss had reached nearly a thousand crore taka by the end of March.
An official of the bank, speaking on condition of anonymity, said, "If this continues, the payment of salaries to officers and employees will become uncertain after June, it will not be possible to pay profits to depositors, and if profits are not received, deposits will start being withdrawn. As a result, the bank's condition will deteriorate further."
Another important indicator is classified investment. Before the August 5 turnaround, the bank's classified investment was at a maximum of 4 percent. After the new board and management took office, the bank is now facing business losses due to its inexperienced and unprofessional policies. According to sources, the classified investment rate at the end of the last March quarter was 32 percent, which is Tk 45,000 crore in terms of money. Against this, the provision of Tk 14,000 crore has to be kept, while the bank has only Tk 700 crore. The bank will definitely fail to achieve the desired profit due to this reason.
In this context, a senior official of the bank, on condition of anonymity, told this reporter that among the classified investments, S Alam Group's investments are very small, the larger amount belongs to other customers. In this context, a senior official of the bank, on condition of anonymity, told this reporter that among the classified investments, S Alam Group's investments are very small, the larger amount belongs to other customers. When S Alam Group's investments are classified in June, September and finally in December, the bank's situation will be dire. He mentioned that the current board or management has no initiative to reduce the amount of classified investments. A source said that the current authorities are spending more time on promotions and postings than on banking business. They have little focus on recovering investment. They are just passing the time hoping for regularization of the distributed investments through rescheduling at the end of the year and a rescue package of Tk 40,000 to 50,000 crore from Bangladesh Bank.
The bank's main source of income was remittances and foreign trade. Remittances have plummeted since the new management took over. Earlier, when the bank used to collect up to 35 percent of remittances alone, it gradually came down to 16.43 percent, as can be seen from the Bangladesh Bank website. Due to the impact of the decline in remittances, the bank's import trade is also on the decline. And due to the lack of support for export-oriented industries, good exporters are moving to other banks. As a result, export earnings are also declining. Considering the trend of import-export, the leading bank in foreign trade is now in a downward trend.
When asked how to get out of this problem, a senior management official said on condition of anonymity that if the central bank creates an environment for compromise with businessmen, introduces revolving facilities, and allows opening LCs within new limits, classified investments will be greatly reduced. The entire banking sector is now at risk due to some decisions that are not business-friendly. Unless businesses are allowed to do business by rescheduling, the distributed investments will be classified again after three months. In addition, due to the widespread investigation into corruption in investment files, none of the branch officers, managers, zone heads, head office officers, and senior management authorities are willing to take responsibility. Officials are passing the time by ignoring their responsibilities. He also commented that it will not take long for the bank to deteriorate further due to the reluctance of senior officials to fulfill their duties.
