Defaulter Shinepukur Ceramics allowed to continue opening import LCs

Bangladesh Bank (BB) has extended a legal exemption allowing defaulter Shinepukur Ceramics Ltd to continue opening letters of credit (LCs) for importing raw materials, aiming to keep the company's production running and protect jobs.

The company is a concern of the Beximco Group.

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In a notification issued under Section 121 of the Bank Company Act, 1991, the central bank said the provisions of Section 27KaKa(3) of the law would remain suspended for the company until December 31, 2027.

The section bars loan defaulters from obtaining new loans or opening LCs.

The exemption authorises Sonali Bank PLC to open LCs with a 100 percent cash margin exclusively for importing raw materials required for the company's manufacturing operations.

The notification said the decision was taken in consideration of the importance of maintaining production at Shinepukur Ceramics and safeguarding employment for its workers.

As a condition of the approval, all revenue earned by the company must be deposited into a designated bank account, from which Sonali Bank's outstanding dues will be repaid on a proportionate basis.

The notification also made it clear that neither the Finance Division nor the Bangladesh Bank would assume any liability related to the credit facility.

It further stipulated that Sonali Bank would not be able to seek any financial support from the government or the central bank in connection with the facility in the future.