BB Plans Winding up Nine NBFIs

Among 35 non-bank financial institutions (NBFIs), nine are likely to shut down soon as the central bank moves to safeguard depositors' money. This will be the first large scale liquidation in country’s financial sector.

Central bank of Bangladesh has decided to wind up nine struggling NBFIs. Because of, they failed to recover from harsh financial distress and defaulted loans. The name of this institutions are Bangladesh Industrial Finance Company, Premier Leasing, People’s Leasing Fareast Finance, GSP Finance, FAS Finance, Prime Finance, Aviva Finance, and International Leasing.
As reported by BB data, these nine NBFIs account for 52 percent of the sector’s total defaulted loans, amounting to Tk 25,089 crore as of last year. The process of closure be expected to being next month under the Finance Company Act 2023. Which is pending government approval and High Court procedures.

The Governor of Bangladesh bank, Ahsan H Mansur utter that, Returning customers deposits will be our main aimed” Further more he also stated that, Legal liquidators will be appointed to manage the process and to ensure funds are recovered to distributed fairly.

Beginning of this year, BB identified 20 financially weak NBFIs and marked them as “red” category because of poor financial health and high non-performing loans. These institutions were asked to explain why their licenses should not be cancelled. However , this nine NBFIs responses unsatisfactory.