4 state-owned banks' non-performing loans reach Tk 1.5 lakh cr

Four state-owned banks in the country are struggling under the overwhelming pressure of non-performing loans (NPLs). In just six months, the classified loans of these banks have surged to nearly Tk 1.5 lakh crore. The latest figures from Bangladesh Bank show that by the end of June this year, the amount of non-performing loans stood at Tk 1,46,362 crore. More than 90% of these have already been identified as 'bad' or 'loss' loans—where the possibility of recovery is almost zero.

A non-performing loan (NPL) is a loan on which the scheduled installment or interest has not been paid consistently for a specific period (generally 90 days or more).

According to Bangladesh Bank's regulations—if the principal or interest installment of a loan remains overdue for three months or more, it is considered a non-performing loan.

Among these, loans with installments overdue for three to six months are considered 'substandard'. Loans with installments overdue for six to nine months are termed 'doubtful'. And loans with installments overdue for more than nine months are identified as 'bad' or 'loss' loans. The amount of such loan in four banks stands at Tk132,499.

The four state-owned banks are—Janata, Sonali, Agrani, and Rupali Bank.

It has been learned that non-performing loans are not the only problem for these banks. Severe capital shortfalls, low allocations against risk-weighted assets, provision shortfalls, and declining profits have left the state-owned banks fighting for survival. According to experts, the question is no longer about profit, but rather how long these banks can survive.

Janata Bank at Highest Risk
Among the four state-owned banks, Janata Bank is in the weakest position. By the end of June 2025, the bank's non-performing loans stood at Tk 72,107 crore, which is 76% of its total disbursed loans. 93% of these loans are 'loss' loans. The bank's capital adequacy ratio is negative at –3.25%, whereas the minimum requirement is 12.5%. In the first six months, the bank incurred a net loss of Tk 2,071 crore.

Sonali Bank Comparatively 'Better'
Among the state-owned banks, Sonali Bank has a relatively lower amount of non-performing loans. By the end of June 2025, the bank's total non-performing loans stood at Tk 19,818 crore. Of this, 'loss' loans amount to Tk 17,257 crore. At the end of December 2024, non-performing loans were Tk 18,058 crore, with 'loss' loans at Tk 15,254 crore at that time.

However, Sonali Bank has succeeded in maintaining its capital reserves. By the end of June, the bank's capital adequacy ratio was 10.10%, which meets the mandatory minimum requirement of 10%. In six months, the bank made a net profit of Tk 591 crore.

Agrani Bank's NPLs at 40%
Agrani Bank's non-performing loans stood at Tk 32,257 crore by the end of June—which is 40.5% of its total loans. 87% of these are 'loss' loans. Its capital adequacy ratio is only 1.97%. In the first six months, the bank made a profit of Tk 114 crore, although it had incurred a loss of Tk 936 crore in the previous six months.

Rupali Bank's 'Loss' Loans at 91%
Rupali Bank's non-performing loans stood at Tk 22,179 crore by the end of June—which is 44% of its total loans. 91% of these are 'loss' loans. Its capital adequacy ratio is only 2.86%. During this period, the bank made a net profit of Tk 8.34 crore, compared to Tk 64.49 crore in the previous six months.

Bankers say that the impact of non-performing loans reduces a bank's capital and profits, as well as its ability to disburse new loans. Additionally, it disrupts investment and business, putting pressure on the overall economy. At the same time, depositors' trust in banks diminishes as the security of their money comes under risk.

Regarding non-performing loans, Bangladesh Bank spokesperson Arif Hussain Khan said, "Over the past decade, owners themselves have tried to destroy the banking sector. Some non-performing loans were being shown as unclassified due to court orders; we have ignored that situation and are now showing all of them as classified. In some cases, forensic audits have revealed that the situation could worsen in the future. Therefore, those loans have now been classified and identified as DF (doubtful for forfeiture)."