Bangladesh Bank has granted special permission to SS Power-1 Limited, an S Alam Group company, to open letters of credit for importing raw materials. Under a directive issued on Sunday, the company may open LCs through Rupali Bank only for raw-material imports after depositing a 100 percent margin. The measure addresses legal complications that arose because the S Alam Group is a loan defaulter.

The directive says Section 27KaKa(3) of the Bank Company Act will not apply to SS Power-1 Limited until December 31, 2027. Under that provision, an affiliated company cannot receive loans or credit facilities when its group is classified as a loan defaulter. A Bangladesh Bank official said the SS Power plant is currently shut and that the facility was granted under a government decision considering the current electricity shortage.

Bangladesh Bank issued the special directive after receiving approval from the Finance Ministry. The directive also states that neither the government nor Bangladesh Bank will assume liability for any loan or financing provided under the arrangement. Lender banks or financial institutions will not be able to seek future financial support from either authority against such loans. Earlier, Shinepukur Ceramics Limited and Abdul Monem Sugar Refinery received similar facilities.