The Credit Information Bureau reported that as of November 30, 2024, the total outstanding loans and liabilities of Beximco Group companies amounted to Tk聽50,098.3 crore, the Bangladesh Bank said in an affidavit submitted to the High Court on Sunday.
The report revealed significant irregularities involving the loans and liabilities, highlighting potential money laundering and tax evasion concerns.
The central bank submitted the affidavit to the bench of Justice Farah Mahbub and Justice Debasish Roy Chowdhury during the hearing of a rule issued on September 5, 2024 asking it to provide information regarding Beximco Pharmaceuticals Limited and all other business concerns of the Group owned by detained businessman Salman F Rahman, who was the private industries and investment affairs adviser to deposed prime minister Sheikh Hasina.
The High Court had issued the rule after hearing a public interest litigation filed by Supreme Court lawyer Masood R Sobhan in a bid to safeguard the group鈥檚 financial integrity and prevent capital outflows.
The High Court adjourned the hearing until January 2025.
On November 12, the Appellate Division of the Supreme Court exempted Beximco Pharmaceuticals from appointing a receiver, but upheld the High Court鈥檚 previous directive requiring the appointment of a receiver for the other companies in the Beximco Group.
The Appellate Division stayed a part of the High Court鈥檚 September 5 order concerning Beximco Pharmaceuticals.
The apex court, however, maintained the directive that a receiver oversees the operations of the group鈥檚 other entities.
Of the outstanding amount, the Bangladesh Bank said, Tk聽25,523.72 crore was classified as defaulted loans, while Tk聽31,075.67 crore was deemed classified.
鈥榃ithout immediate repayment of instalments, a substantial portion of these classified amount is expected to enter into the defaulted status soon,鈥� the Bangladesh Bank added.
According to the Bangladesh Bank鈥檚 affidavit, the central Bank compiled a detailed report listing banks and financial institutions that provided financial facilities to various entities of the Beximco Group, including loans, advances, letters of credit and guarantees.
The report, which highlights potential money laundering and tax evasion concerns, revealed significant irregularities and illegalities in loan dealings.
According to the report, as of September 30, 2024, 16 scheduled banks and seven financial institutions had extended loans to the Beximco Group companies.
Janata Bank granted loans to 29 companies of the Beximco Group, with an outstanding amount of Tk聽23,911.95 crore, of which Tk 19,507.42 crore was classified as non-performing.
IFIC Bank also provided loans to 29 companies, totalling Tk聽13,463.47 crore in outstanding dues. National Bank extended loans to nine companies, with Tk聽3,182.19 crore outstanding.
Sonali Bank financed four companies, with Tk 1,676.75 crore outstanding, including Tk聽1,544.15 crore in classified loans.
Agrani Bank extended Tk 1,009.13 crore in loans to four companies, while AB Bank financed six companies with Tk 1,838.48 crore in outstanding dues.
Exim Bank granted loans to five companies, with Tk 468.02 crore outstanding, of which Tk 327.08 crore was classified as non-performing.
Several other banks also financed one or more companies of the Beximco Group.
These patterns suggest attempts to obscure the actual beneficial ownership of the borrowing entities.
The Bangladesh Bank鈥檚 report outlined a series of measures to address the irregularities.
The central bank advised Sonali Bank to take departmental action against employees involved in loan irregularities.
It also asked Sonali Bank to secure adequate collateral for loans granted to Beximco Computers Limited and to rectify irregularities identified in its 2020 inspection report.
The central bank asked Padma Bank to explain changes in loan status during the issuance of additional loans.
It asked Janata Bank to scrutinise exaggerated production figures reported by certain companies and to clarify violations of Section 26(Kha) of the Bank Companies Act, 1991, regarding exceeding single-borrower exposure limits.
It questioned Janata Bank on the non-repatriation of export proceeds amounting to Tk 5,827.97 crore.
The central bank asked the National Bank to classify loans granted to Independent Television and GMG Airlines.
It asked why GMG Airlines鈥� shares, already pledged as collateral for other loans, were reused as securities.
The central bank asked IFIC Bank to classify loans granted to multiple entities, including Brightstar Ltd, Elton Trading and Vista International.
It directed IFIC to take punitive action against employees for breaching customer due diligence requirements under the 2016 BRPD circular.
The central bank asked IFIC to investigate improper utilisation of public funds and recover overdue loans.
It referred to the Anti-Corruption Commission for further investigation and potential legal action.
The central bank also revealed that Beximco Group exported products to its UAE-based sister concern, RR Global Trading, with overdue export proceeds remaining not repatriated.
It suspected that the funds might have been laundered, given the violations of foreign exchange regulations.
The report also noted that 10 directors of Beximco Pharmaceuticals Limited are common to 60 other companies in the group.
The Bangladesh Bank recommended the appointment of a receiver to inspect and ensure the recovery of loans from these companies.
The High Court had initially ordered the Bangladesh Bank governor to appoint a receiver to manage Beximco Group assets, including those associated with its vice-chairman Salman F Rahman.
