SBAC Bank faces Tk810.75cr provision shortfall in 2024

Infographic: TBS

South Bangla Agriculture and Commerce (SBAC) Bank ended 2024 with a provision shortfall of Tk810.75 crore, largely due to a surge in classified loans, according to its auditor's report.

The private lender's total required provisioning against loans, advances, and lease or investment rose sharply to Tk1,143 crore last year, which was Tk382 crore in 2023. 

The bank, however, managed to maintain a provision of only Tk487.17 crore, the auditor stated in its qualified opinion, citing a central bank letter on 27 April. In 2023, it managed to maintain a provision of Tk346.43 crore.

Despite the shortfall, the Bangladesh Bank has allowed the bank to finalise its 2024 annual report. 

As per SBAC Bank's financial report, its net interest income increased by 17% to Tk193.76 crore while its total operating income surged by 13.58% to Tk576.85 crore. 

However, despite increases in profit before provision and taxation, the bank's net profit dropped by 80% to just Tk10.94 crore, due to the increase in provisioning requirements. 

Its earnings per share (EPS) stood at Tk0.13.

Because of the provisioning shortfall, the bank has been barred from declaring any dividend for 2024. In 2023, it issued a 2% cash dividend to shareholders.

In the first quarter of this year, the bank reported that its net interest income declined by 42.62% to Tk31.03 crore while its total operating income fell by 21.45% to Tk113.24 crore. 

After maintaining provisions, its net profit dropped to Tk11.28 crore with an EPS of Tk0.14, compared to Tk19.99 crore and an EPS of Tk0.24 in the same period last year.

Yesterday, SBAC Bank's shares closed at Tk6.60 each at the Dhaka Stock Exchange (DSE). 

SBAC Bank, which raised funds from the capital market, was listed on the bourses in 2021. As of May 2025, sponsor-directors held 68.19% of its shares, institutional investors held 16.59%, and general shareholders owned 15.22%, according to the DSE.