DHAKA — Bangladesh’s banking sector saw a steep rise in non-performing loans last year, leaving many lenders unable to maintain required provisions. To shore up their books, the central bank granted 2.63 trillion taka (about $22 billion) in deferral relief to 19 banks.
Eleven banks used the relief to post profits, though none paid dividends. Eight others slipped into big losses despite receiving the same support, according to an analysis of the banks’ 2025 financial reports.
Central bank officials said deferral relief is granted each year to banks short on provisioning so they can present comparatively better year-end financial statements. Although the relief is meant for one year, in practice most banks have failed to close the shortfall in any given year, and the pattern has continued for years. Without the relief, banks face pressure on capital and other assets, the officials said.
Under the rules, banks must maintain provisions ranging from 0.25 percent to 100 percent depending on loan quality. When a bank fails to do so, the shortfall is adjusted against its capital, eroding the capital base. Listed banks with provision shortfalls are also barred from paying dividends to shareholders. To get around both constraints, banks have long used deferral relief to declare profits and pay dividends. Sixteen banks used the relief before finalizing their 2023 reports and went on to pay dividends. The central bank closed off that option in 2024 and 2025.
Banks that took deferral relief because of provisioning shortfalls could not pay dividends for 2024, according to officials. In March last year, Bangladesh Bank also issued new dividend rules barring any dividend payment by banks with non-performing loan ratios above 10 percent. The rules took effect from the 2025 financial year, and about 34 banks could not pay dividends last year as a result.
11 banks in profit using deferral relief
Eleven banks reported net profits against provisioning shortfalls with the help of deferral relief. State-owned Rupali Bank received 14,014 crore taka in deferral relief last year and posted a net profit of 6 crore taka, down from 11 crore the previous year. State-owned Agrani Bank also reported profits, receiving 15,324 crore taka in relief and posting a net profit of 58 crore taka in 2025 after a 925-crore loss in 2024.
Islami Bank received the largest share of deferral relief in 2025 at 88,000 crore taka, after non-performing loans rose at an unusually steep pace and the bank’s provision shortfall widened sharply. Despite the large relief, its net profit was just 136 crore taka. Al-Arafah Islami Bank received 4,998 crore taka in relief and posted a net profit of 85 crore taka in 2025, up from 76 crore the previous year. Standard Bank received 3,845 crore taka and posted a net profit of 80 crore taka in 2025, down slightly from 82 crore.
Mercantile Bank received 2,161 crore taka against its provision shortfall and posted a profit of 122 crore taka in 2025, up from 64 crore in 2024. NRBC Bank received 1,006 crore taka and posted a net profit of 13 crore taka. South Bangla Agriculture and Commerce (SBAC) Bank took 1,023 crore taka in relief and reported a net profit of just 70 lakh taka last year, down from 11 crore the previous year. United Commercial Bank (UCB) received 5,595 crore taka in relief and posted a 23-crore profit in 2025. NRB Bank received 180 crore taka in relief and reported a 13-crore profit, while One Bank took 1,202 crore taka in relief and posted a 21-crore profit.
Eight banks still in big losses despite relief
Even with deferral relief, eight banks slipped into losses. State-owned Janata Bank received 50,942 crore taka in relief but reported a loss of 3,931 crore taka in 2025, up from a 3,066-crore loss in 2024. The bank holds a large share of its non-performing loans against Beximco Group, owned by Salman F. Rahman, an adviser to the ousted prime minister, and losses are rising because the loans are not being recovered, officials said.
Basic Bank received 5,082 crore taka in relief but lost 810 crore taka in 2025, against a 863-crore loss the previous year. Bangladesh Development Bank (BDBL) received 225 crore taka and posted a 70-crore loss. Private-sector AB Bank received 16,290 crore taka but reported a 3,889-crore loss in 2025, up from a 1,905-crore loss in 2024.
IFIC Bank took 21,578 crore taka in deferral relief but posted a 2,559-crore loss in 2025. National Bank took 18,608 crore taka but slipped into a 2,429-crore loss after a 1,722-crore loss the previous year. Premier Bank received 9,799 crore taka in relief but lost 123 crore taka. Bangladesh Commerce Bank took 1,244 crore taka in relief and posted a 479-crore loss.
A senior Bangladesh Bank official said the actual provision shortfall in the banking sector is even larger, but various central bank policy concessions help understate it. Without deferral relief, banks would face wider capital shortfalls, the official said. Lower capital raises the cost of international trade for banks, because foreign banks set terms based on capital adequacy, and trade-finance costs go up when capital is short.
বাংলায় মূল প্রতিবেদন পড়ুন · Read the original Bengali report