Over Tk 161b stuck as BASIC Bank litigations pile up

More than Tk 161 billion of BASIC Bank's funds remain locked in prolonged litigation, reflecting deep-rooted weaknesses in loan recovery and legal resolution, sources say.
They say the state-owned bank is currently involved in 1,230 pending cases, with a total claim value of Tk 161.58 billion, the bulk of which is tied up in money loan courts under the Artha Rin Adalat.
According to the bank's legal division, out of the total cases, some 535 Artha Rin Adalat cases alone involve Tk 160.60 billion, underscoring the bank's heavy dependence on the money loan court system for recovering default loans.
In contrast, some 155 writ petitions are pending, mostly related to procedural or administrative disputes, carrying no direct financial claim.
Meanwhile, 540 criminal and miscellaneous cases involve a comparatively small amount of Tk 978 million.
The age profile of these cases suggests a serious delay in the judicial process, further complicating the bank's recovery prospects, according to a source.
The document says 117 cases have remained unresolved for over a decade, tying up Tk 2.13 billion.
Another 230 cases, involving Tk 39.18 billion, have been pending for five to 10 years, with recovery timelines remaining uncertain.
Experts warn that without fast-track disposal of high-value Artha Rin cases, the bank's liquidity pressure and reliance on state support are unlikely to ease anytime soon.
Although the majority of cases - 883 in total - are less than five years old, they account for the largest share of the stuck funds, amounting to Tk 120.27 billion.
The document shows no active cases under insolvency (bankruptcy), certificate, or AT categories, indicating that the bank has largely avoided alternative recovery mechanisms and remains reliant on conventional litigation channels.
Banking sector analysts say the accumulation of long-pending cases reflects institutional inefficiencies and legal bottlenecks that continue to erode the bank's financial health.
According to another report, the total recovery came to just Tk 48 million against outstanding loans of Tk 25.40 billion from its top 20 defaulters as of December 2025.
"The bank granted loans bypassing rules in recent years, increasing the volume of classified loans and eroding the value of collateral," says a senior bank official.
The Awami League government appointed Sheikh Abdul Hye Bachchu as the chairman of the Bank in September 2009 on a contractual basis for three years.
Later, his tenure was extended for two years in September 2012.
Sources say the bank's performance started deteriorating as Bachchu and other directors allegedly indulged in "gross irregularities in sanctioning loans in violation of relevant rules and regulations".
The bank's board of directors was dissolved in 2014 as a consequence.
The Bangladesh Bank findings show a staggering Tk 35 billion in loans was allegedly disbursed irregularly from the Gulshan, Dilkusha, and Shantinagar branches of the bank between 2009 and 2011.
Presently, the problem-ridden bank has taken a three-year plan of action to reduce its staggering default loans to a tolerable level.
The government provided the bank with funds between fiscal years 2013-14 and 2016-17 to meet its capital shortages.
The bailout amounted to Tk 12 billion in 2015 and Tk 10 billion in 2017 for capital replenishment, which was desperately needed for addressing the bank's existential crisis.

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