Defaulted loans at the country’s non-bank financial institutions (NBFIs) have surged to a record 37 percent, highlighting the sector’s fragile condition.

The rise reflects growing stress in the overall financial sector

The jump in bad loans forced the commercial lender to make heavy provisions

The Bangladesh Bank (BB) has set a target to reduce non-performing loans (NPLs) to 25 percent from the current 36 percent by March, according to senior bankers.

Nearly three out of every four taka lent by National Bank has now gone unpaid, according to the central bank, after stay orders that had long protected several large borrowers were lifted in recent months.

Biannual report to BB shows Sonali Bank’s strong liquidity and asset quality

Scams and irregularities by S Alam Group pushed the shariah-based bank into crisis, as toxic assets continue to surface

The businesses are seeking repayment periods ranging from five to 15 years

BB data show that as of June, 222,341 cases involving Tk 407,435 crore were pending across the courts

BB governor says as businesses demand action

Defaulted loans in the banking sector rose further to Tk 6.44 lakh crore, or nearly 36 percent of total disbursed loans, at the end of September, indicating the continued fragile state of the country’s financial sector.

Bangladesh Bank has not published the banking sector’s classified loan data for the April-June quarter even five months after it ended, leaving analysts without a clear picture of the sector’s condition.

AB Bank’s bad loans have ballooned to an unprecedented level, with nearly 84 percent of its total loans in default, a sign of severe financial distress caused by years of irregularities at the country’s first private commercial lender.

Standard Bank is mired in internal conflict as its bad loans rise to nearly a third of total lending, exposing governance problems at the shariah based lender already under scrutiny by the central bank, show documents. 

Corporate social responsibility (CSR) spending by Bangladesh’s banks nearly halved in the first half of 2025 amid rising bad loans, according to Bangladesh Bank’s (BB) half-yearly report on CSR activities of scheduled banks and non-bank financial institutions.

Banking sector's asset quality declines as distressed loans balloon to Tk 7.56 lakh crore

The reviews, initiated in January with backing from the ADB, expose deep-seated financial mismanagement at those banks

Twenty-one banks managed to keep their bad loan ratios under 5 percent of their total lending, even amid turbulence last year that rattled the sector and eventually pushed up the industry average of bad loans to 16.8 percent.

Just ten banks, both state-owned and private, account for 71 percent of all non-performing loans (NPLs) in the country’s banking sector.

Central bank must strive to improve banking sector’s health