Shares of Islami Bank Bangladesh plunged below Tk20 today (2 November) for the first time in six years, as mounting losses, soaring bad loans and deepening financial distress continued to erode investor confidence in the country’s largest private bank.
The bank’s share price fell 5.34% to close at Tk19.50 on the Dhaka Stock Exchange (DSE) today, dropping below the Tk20 mark for the first time since 2020.
The decline marks a sharp reversal from 24 September 2024, when the share price peaked at Tk64 and the bank’s market capitalisation crossed Tk10,000 crore for the first time. At today’s closing price, its market value stood at Tk3,139 crore, wiping out nearly Tk7,000 crore from its peak valuation.
The sharp fall reflects growing concerns over the bank’s financial health. Islami Bank reported a consolidated profit of around Tk100 crore in the first nine months of 2025 but swung to a consolidated loss of Tk3,286 crore in the same period of 2026. Its standalone loss reached Tk3,302.57 crore.
The bank suffered a particularly severe setback in the July-September quarter, reporting a loss of Tk1,970.18 crore.
In its financial disclosure, the bank attributed the deterioration mainly to lower investment income and higher profit expenses on deposits.
It said investment income was constrained by a large volume of classified investments, largely linked to fund embezzlement by connected parties and significant legacy exposures. Meanwhile, deposit profit expenses increased despite a decline in the deposit base.
The scale of the problem is reflected in the bank’s 2025 annual report. Classified loans surged 44% to Tk94,322 crore, accounting for 51% of its total loan portfolio, up from 42.36% in 2024.
The report also revealed a massive provisioning shortfall. Against a required provision of Tk92,537.56 crore, the bank maintained only Tk7,922.41 crore, leaving a gap of Tk84,615.15 crore.
A senior bank official attributed the surge in reported bad loans to previously concealed exposures linked to the S Alam Group, which took control of the bank in 2017.
The bank has been operating without a regular board or managing director since Bangladesh Bank dissolved its board in June 2026. A central bank-appointed administrator is overseeing the institution, while an acting managing director is running its operations.
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