ILFSL to seek low-cost fund to repay depositors

Business Desk :
Scam-hit International Leasing and Financial Services Limited (ILFSL) is going to seek a long-term, low-cost fund from the finance ministry and the Bangladesh Bank to repay depositors’ money.
“Now we need such a fund to pay back depositors and revive the company as it is facing a financial crisis,” said Md Mashiur Rahman, managing director (current charge) of ILFSL.
This was still at the planning stage and the ILFSL board would submit a proposal to the finance ministry and the central bank next month, he said.
He also told the fund’s amount was yet to be finalised. “The fund may come with a one-year grace period.”
ILFSL has recovered Tk 116 crore from defaulters since Nazrul Islam Khan’s appointment to the board. The High Court on March 22 last year appointed Nazrul, a retired senior secretary of the government, as a new independent director and chairman of the company.
The court on July 6 this year also appointed five independent directors to the ailing non-bank financial institution (NBFI) in a bid to revive it.
The NBFI has already paid back 1,892 depositors on humanitarian grounds, as per its officials.
The company’s total depositors stood at 4,019 till December last year. Of them, 3,071 were individual depositors, and 948 corporate depositors.
The NBFI’s total deposits stood at Tk 2,767.66 crore in December 2019, and Tk 543.67 crore of that was from individual depositors.
“Depending on cash flow, we are now paying back depositors who are physically ill and suffering from various diseases,” said Mashiur.
He said ILFSL was paying back depositors as soon as it was recovering money from defaulters.
“It is not very easy to recover loans from defaulters,” said Mashiur. He said ILFSL had taken initiatives to sell some mortgaged assets of borrowers but “it is time-consuming”.
As per the central bank data, the total outstanding loans of the company stood at Tk 4,022 crore in March this year, and Tk 2,999 crore (74.56 per cent) of that became default. The number of defaulters stood at 154 in December 2020.
Nazrul told company officials were facing various difficulties in recovering loans from defaulters.
“It was the worst experience when a borrower filed a lawsuit against us as we tried to recover loans from him,” he explained.