Bangladesh’s Financial Institutions Division has ordered state-owned Janata Bank PLC to prepare a specific, measurable turnaround plan to address severe financial stress and irregularities. The instruction was issued at a high-level meeting with the bank’s board, managing director and other officials, chaired by Financial Institutions Division Secretary Nazma Mobarek. The bank was told to pursue priority targets over the next 12 to 24 months.

Officials said nearly 70 percent of Janata Bank’s total loans are now non-performing, while its capital base has become very weak and it is operating with a sharply negative net interest margin. A large share of bad loans is concentrated among a small number of influential clients. The bank was directed to identify these major accounts and create separate, time-bound resolution plans, with cash recovery treated as a distinct performance indicator.

The division also called for caution on new large loans, increased quality lending to SMEs, agriculture and productive sectors, and stronger internal controls, audits and compliance. Janata Bank must decide quickly whether to continue or orderly close its Dubai or UAE operation. Chairman M Fazlur Rahman said the bank had begun work under the division’s instructions.