Four merging banks owe Tk4,010cr in bonds

Four out of the five troubled Shariah-based banks set to be merged into one collectively owe institutional investors Tk4,010 crore in bonds, according to their latest financial statements.

The banks are Exim Bank, Social Islami Bank, Union Bank and First Security Islami Bank. The fifth, Global Islami Bank, which was listed on the stock market in 2022 after raising Tk425 crore through an initial public offering (IPO), has not issued any bonds since its listing.

The liabilities, shown in the banks' balance sheets as of September 2025, originated from bond issuances approved by the Bangladesh Securities and Exchange Commission (BSEC) to help meet regulatory capital requirements. One of the four banks is yet to publish its nine-month financials, and its bond data is available up to June 2025.

The Bangladesh Bank yesterday dissolved the boards of the five banks, which became financially distressed after thousands of crores of taka were allegedly syphoned off through irregularities and multiple loans.

At a press conference yesterday, Bangladesh Bank Governor Ahsan H Mansur said depositors of the five banks are likely to get access to their funds within a month.

In response to a question about what would happen to the Tk4,000 crore raised through bond issuance by the five banks, the governor said, "We will review the liabilities related to those bonds."

He said, "In other words, we will first examine how the funds were used and what class of liability they fall under. Very soon, through a government gazette notification, we will clearly state the procedure for investors to recover their money. However, they will get their money back in one way or another."

The governor further clarified, "In the notification, we will specify the categories of investors or bondholders. If necessary, the validity of the bond claims will be determined and appropriate recovery techniques will be applied."

Exim Bank's Tk1890cr in bonds

According to Exim Bank's consolidated balance sheet, it owed Tk1,890 crore in bond liabilities – Tk1,290 crore in Mudaraba Subordinated Bonds and Tk600 crore in Mudaraba Perpetual Bonds.

The bank has issued six subordinated bonds between 2015 and 2024. Of these, two early bonds worth Tk250 crore (2015) and Tk400 crore (2017) have been repaid. The remaining liabilities include Tk315 crore from a Tk600 crore bond issued in 2019, Tk400 crore from a Tk500 crore bond issued in 2021, and full dues of Tk400 crore and Tk250 crore from bonds issued in 2023 and 2024, respectively.

Union Bank's Tk170cr

Union Bank issued a Tk400 crore Mudaraba Subordinated Bond to meet its tier-2 capital requirements. Its bond liabilities stood at Tk170 crore at the end of September 2024, down from Tk240 crore in December 2023. The bank has yet to publish its financial statement for 2025.

Social Islami Bank's Tk1,200cr

Social Islami Bank issued four Mudaraba Subordinated Bonds between 2015 and 2022, raising Tk1,800 crore to strengthen its capital base under Basel-III requirements. Of this, bonds worth Tk700 crore have been repaid, while Tk700 crore remains outstanding, along with partial repayments of another Tk400 crore.

Additionally, SIBL issued a Tk500 crore Mudaraba Perpetual Bond in 2022, which remains fully outstanding. Major subscribers include Islami Bank Bangladesh (Tk150 crore), Exim Bank (Tk150 crore), AIBL Employees Provident and Gratuity Fund (Tk100 crore), and Al-Arafah Islami Bank (Tk100 crore).

First Security Islami Bank's Tk750cr

As of June 2025, First Security Islami Bank owed a total of Tk750 crore in bonds – Tk150 crore in Mudaraba Subordinated Bonds and Tk600 crore in Mudaraba Perpetual Bonds.