Staff Reporter :
The written-off loans in Bangladesh’s banking sector surged by 52.16 per cent year-on-year, reaching Tk 81,578 crore at the end of December 2024, up from Tk 53,612 crore a year earlier, according to recent data published by Bangladesh Bank (BB).
Of the total amount, state-owned banks accounted for Tk 25,832 crore, while private commercial banks wrote off Tk 52,780 crore as of 31 December 2024. The sharp increase is being attributed to a rise in non-performing loans (NPLs) and relaxed loan write-off policies introduced by the central bank in February 2024.
Under the revised policy, banks are now permitted to write off defaulted loans classified as ‘bad and loss’ after two years, a reduction from the three-year requirement set in 2019, which had itself replaced the earlier five-year rule. Once written off, these loans are moved to off-balance sheet items, allowing banks to improve the appearance of their asset quality, although the liabilities remain unresolved.
Sonali Bank, the largest state-owned bank, topped the list with Tk 8,568 crore in written-off loans, followed by Agrani Bank with Tk 5,627 crore, Janata Bank with Tk 5,126 crore, and Bangladesh Development Bank Limited with Tk 2,968.89 crore.
In the private banking sector, Southeast Bank wrote off Tk 3,664 crore, United Commercial Bank Tk 3,197 crore, Prime Bank Tk 3,184.76 crore, The City Bank Tk 3,164.79 crore, BRAC Bank Tk 2,962.5 crore, and Bank Asia Tk 2,664 crore.
Collectively, the top 10 banks accounted for Tk 41,129 crore, representing nearly half of the total write-offs in the sector by the end of 2024.
The rise in written-off loans coincides with a sharp escalation in non-performing loans, which increased by Tk 1.34 lakh crore in the last six months of 2024, bringing the total to Tk 3.45 lakh crore as of December.
This figure now represents 20.2 per cent of the total outstanding loans in the banking system, which stood at Tk 17,11,402 crore at the end of 2024.
While loan write-offs are an accepted accounting practice to clean up balance sheets, financial experts warn that such measures should not substitute for effective credit risk assessment, loan recovery efforts, and governance reforms. Persistent growth in NPLs and write-offs may erode public confidence and signal deeper structural weaknesses within the sector.
