Islami Bank Bangladesh’s non-performing loans rose to about Tk98,915 crore at the end of June 2026, equal to 52.14 percent of total loans, according to the report. The bank’s financial condition has deteriorated amid renewed confidence concerns and pressure from deposit withdrawals. Its provision shortfall exceeded Tk82,334 crore, while the actual capital shortfall was about Tk90,188 crore at the end of March. The bank recorded a net loss of Tk1,316.48 crore in the first six months of 2026.

The report says much of the troubled lending is linked directly or indirectly to S Alam Group-related entities. Bank sources said 15 of the top 20 defaulting borrowers were associated with the group and its owner Saiful Alam’s family, accounting for Tk57,175 crore, or about 62 percent, of total defaulted loans. Another five top borrowers owed Tk5,697 crore, with information indicating indirect benefits involving S Alam Group and Nabil Group.

Additional Managing Director Jamal Uddin Majumdar attributed the rise partly to borrowers failing to make scheduled installments, including on previously rescheduled loans. After unrest and increased withdrawals in June, Bangladesh Bank pledged support on June 12 and dissolved the full board on June 14, assigning its powers to Executive Director Zahir Hossain.